Brixmor Property Group Inc. — Call Transcript 2026

Greetings and welcome to the Brixmor Property Group fourth quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Stacy Slater. Thank you. You may begin. Thank you, operator, and thank you all for joining Brixmor's fourth quarter conference call. With me on the call today are Brian Finnegan, CEO and President, and Steve Gallagher, Chief Financial Officer. Mark Horgan, Executive Vice President and Chief Investment Officer, will also be available for Q&A. Before we begin, let me remind everyone that some of our comments today may contain forward-looking statements that are based on certain assumptions and are subject to inherent risks and uncertainties. As described in our SEC filings, an actual future result may differ materially. We assume no obligation to update our forward-looking statements. Also, we will refer today to certain non-GAAP financial measures. Further information regarding our use of these measures and reconciliations of these measures to our GAAP results is available in the earnings release and supplemental disclosure on the investor relations portion of our website. Given the number of participants on the call, we kindly ask that you limit your questions to one per person. If you have additional questions, please re-queue. At this time, it's my pleasure to introduce Brian Finnegan. Thank you, Stacy, and good morning, everyone. I am thrilled to join you today for my first call as permanent CEO of Brixmor, a company that has been my professional home for more than 21 years. Before touching on our results for the quarter and the year, I will share a few comments on our leadership succession and strategy going forward. First, a sincere thank you to Jim Taylor for his extraordinary leadership and mentorship. His impact on Brixmor and our industry is immense, and I was proud to be by his side for the last 9.5 years as we dramatically transformed this portfolio. We wish him the very best in his retirement. I also want to thank the board for their confidence and the Brixmor team for their support. I am grateful to step into this role at a moment of real strength for the company. Our portfolio transformation and disciplined execution position us exceptionally well to accelerate our growth going forward. The fundamentals for open-air, grocery-anchored retail remain favorable. Consumers have been resilient. Thriving tenants are expanding their physical store presence, and new retail supply remains at historic lows. Against this backdrop, the Brixmor operating platform stands out as our low-rent basis continues to provide industry-leading mark-to-market opportunity while our future reinvestment and sign-but-not-commence pipelines provide unmatched visibility on future growth and cash flows. We do not anticipate any changes to our operating model in the near term outside of a few of our talented leaders taking on more responsibilities. Specifically, congratulations to Stacy Slater on her promotion to Executive Vice President, Capital Markets, Corporate Strategy and Investor Relations, and Matt Ryan, who will expand his role as South Region President to include National Property Operations. Both will join our executive committee. More broadly, the operational realignment we implemented 18 months ago, consolidating from four to three regions, continues to pay dividends through greater efficiency, stronger leasing execution, and disciplined capital allocation. We are also leaning in further to technology and analytics. Early initiatives in AI and automation are already yielding positive results in areas such as lease abstraction and summarization, tenant health analyses, and leasing prospecting tools. Externally, we are going to remain disciplined but opportunistic. Under Mark's leadership, we were net acquirers in four of the last five years, with 2025 being our most active year as a public company at approximately $420 million of asset value acquired in Houston, Southern California, and Denver. We expect to continue allocating capital towards opportunities where our platform can create outsized value without having to rely on acquisitions for growth, and we are mindful of our balance sheet in every capital allocation decision we make. Now let's turn to our results for the quarter and the year, which were exceptional. As Steve will touch on further, same property NOI grew by 4.2% for the year, even as we recaptured 1.5 million sq ft of anchor space. FFO for the year was at the high end of our guidance range at $2.25 per share and up 5.6% year-over-year. We delivered a record leasing year with $70 million of new rent executed, small shop occupancy increasing to a new high of 92.2%, and ended the year with the largest sequential overall occupancy gain in the company's history, up 100 basis points to 95.1%. Demand from high-quality tenants remains robust. As within the over 3 million sq ft of new leases executed last year, we signed 8 new grocer leases with strong operators such as Publix, Sprouts, and Big Y, and multiple leases with each of the leading retailers in the off-price segment. From a small shop standpoint, we continue to be impressed by the depth and credit quality of the operators in the health and wellness, quick service restaurant, and service segments as we continue to attract a higher caliber tenant to this portfolio. The strength of our small shop tenancy is also evidenced by the fact that 70% of our small shop rent is derived from multi-unit operators. Our team also continued to capture the mark-to-market upside in the portfolio, with new lease rent growth for the year at 39% and renewal rent growth for the year at 15%, resulting in our third consecutive year of mid-teens renewal growth. We also saw improvement in our retention rate, which at year-end was 87%, a 180 basis point improvement from last year. Switching to operations, we continued to deploy capital efficiently and leverage competition for space to reduce our deal costs, with overall CapEx spending down 14% year-over-year and the lowest since 2021, while maintenance CapEx spending was at our lowest level since 2016 outside of the pandemic year. In addition, disciplined operating expense spending resulted in a record expense recovery ratio at year-end of 92.3%. On the reinvestment front, we stabilized $183 million of projects in 2025 at an attractive 10% incremental yield. This included some of the most impactful projects in the company's history, such as The Davis Collection, where we tore down an obsolescent anchor adjacent to a high-performing Trader Joe's grocer and delivered a new Nordstrom Rack, Ulta, J.Crew Factory, Mendocino Farms, Urban Plates, and several other exciting tenants across the street from UC Davis. At year-end, we had $336 million in the active pipeline, including Rockland Plaza, which we added to the active pipeline this quarter as we kick off the redevelopment of this well-located center in the New York Metro area with Nordstrom Rack, Ross Dress for Less, Burlington, and new out-parcel buildings and several exciting shop tenants. Behind the active pipeline, our deep shadow pipeline of projects, including several more with Publix, provides us years of runway for value-creating redevelopment in what we already own and control. Moving to our transaction activity, we acquired 2 high-quality grocery-anchored centers in Denver and Southern California in the fourth quarter. Both have immediate leasing and mark-to-market upside, are accretive to our long-term growth profile, and are in markets that our West Region team has created significant value in. We also completed $170 million of dispositions during the quarter, where we saw limited ROI going forward, including our last asset in Alabama. In closing, thanks to the Brixmor team's record performance, we entered 2026 with tremendous momentum in the business. Our properties hosted over 9 million visits last year, and our tenant lineup reflects the strongest underlying credit profile in our company's history. The portfolio looks the best it ever has. Our balance sheet is in the strongest position it has ever been, and our platform is positioned to drive consistent, durable growth. I am so energized for what lies ahead and grateful to lead this team as we accelerate our business plan. With that, I'll hand the call over to Steve for a deeper review of our financial results and 2026 outlook. Steve? Thanks, Brian. The strength and resiliency of our business model were clearly evident in 2025. We executed consistently throughout the year despite the significant amount of space we recaptured, delivered 5.6% FFO growth, achieved 4.2% Same Property NOI growth, and meaningfully improved our underlying tenant profile. As a result, our portfolio is the strongest position it has ever been, and we are exceptionally well-positioned to capture the continued demand for well-located open-air retail centers. Fourth quarter, Same Property NOI increased 6%, supported by a 360 basis points contribution from base rent growth due to stacking rent commencements from late 2024 and all of 2025. Ancillary and other income contributed an additional 200 basis points, reflecting our team's proactive asset management initiatives to drive revenue across the portfolio. NAREIT FFO was $0.58 per share in the fourth quarter, benefiting from strong Same Property NOI performance and elevated lease termination income. As we noted last quarter, we anticipated higher lease termination activity as we proactively recaptured space to unlock value creation opportunities across the portfolio, with the largest of these transactions in the Bay Area. Same Property NOI increased 4.2% for the year despite over 200 basis points of tenant disruption headwinds. Base rent contributed 360 basis points, and ancillary and other income added 110 basis points, driven equally by the updated recurring parking agreement at Pointe Orlando discussed on our prior calls and asset management initiatives. NAREIT FFO per share was $2.25, up 5.6% from last year, supported by broad-based operational strength across the portfolio. We commenced a record $70 million of ABR in 2025. We fully replenished that volume by executing another $70 million of net new rent, a clear indication of the depth and durability of demand. Our signed-but-not-yet commenced pipeline at year-end totaled $62 million at an average of $23 per sq ft and includes $50 million of net new rent. The spread between leased and built occupancy ended the period at 350 basis points, and we anticipate approximately $43 million of that signed-but-not-yet commenced pipeline to commence rapidly throughout 2026. The tailwinds created by the stacking of 2025 rent commencements, contributions from redevelopment, embedded rent bumps, and combined with the signed-but-not-yet commenced pipeline provide strong visibility into our 2026 outlook. We're guiding to 4.5%-5.5% same property NOI growth, driven by more than 450 basis points of expected base rent contribution. We also expect net expense reimbursements will contribute to growth as we expect average built occupancy to increase over last year. Our continued transformation across the portfolio has meaningfully enhanced the credit quality of our tenant base, which is now the strongest we've seen. As a result, we expect revenues deemed uncollectable of 75 to 100 basis points of total revenues. In terms of cadence, we expect base rent growth to accelerate throughout the year as we commence the significant rent embedded in the SNO pipeline. Our FFO guidance reflects the strength of our same property NOI trajectory. For 2026, we are introducing NAREIT FFO guidance of $2.33-$2.37 per share, representing 4.4% growth at the midpoint, even while absorbing a $0.03 headwind from lower lease termination income as we return to historical levels and a $0.03 headwind from higher interest expense. Capital deployment across the portfolio remains highly efficient, with leasing and maintenance capital expenditures down approximately $26 million year-over-year. Strong competition for space continues to push net effective rents to a record $23.66, and our payback period now averages two years, the most attractive levels we've seen in nearly a decade. We have steadily reduced maintenance capital expenditures over several years while enhancing the overall quality and appearance of our centers. We ended the period with $1.6 billion of available liquidity, including $360 million in cash raised in our September 2025 4.85% issuance, which pre-funded our June 2026 $600 million 4.125% maturity. Debt to EBITDA is 5.4 times, leaving our balance sheet well-positioned to support our business plan. Our performance continues to highlight the durability of our fundamentals and the attractiveness of our strategy, supported by FFO growth of 4%+ since 2022, a 4.4% dividend yield, and a dividend growing at a 6% CAGR over that same period. I want to thank our team for their ongoing dedication and execution, which remains a key driver of our performance. With that, I'll turn the call over to the operator for Q&A. Thank you. We will now be conducting a question-and-answer session. We ask that all callers limit themselves to one question. If you have additional questions, you may re-queue, and those will be addressed time permitting. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we pull for questions. Thank you. Our first question comes from a line of Michael Goldsmith with UBS. Please proceed with your question. Good morning. Thanks a lot for taking my question. Your guidance for bad debt this year, 75-100 basis points. I guess as you entered last year, you guided to 75-110 basis points. I think you called out an upgraded portfolio quality or upgraded tenants. But I guess to try to, can you provide a little bit more detail there? And how much does this new guidance range reflect just line of sight into tenant bankruptcies? Thanks. Yeah. Michael, thanks for the question. And I'll start and let Steve take it. As both of us touched on, we're really encouraged by the tenant health trends in the portfolio. And when we sat here a year ago, we said that on the other side of these recaptures, you would see improvement in what was already the strongest underlying tenancy that we had. So if you think about our low drugstore exposure, if you look at our low theater exposure, the quality and strengths of our small shop tenancy as I mentioned, 70% of our small shops are for multi-tenant operators. All the work that we've done to the portfolio has just allowed us to attract a much stronger tenancy. So that's reflected in terms of the guidance going forward and how we're thinking about our expectations for bad debt. Steve, you want to touch on more? Yeah. I mean, I think Brian hit on the macro trends. Just when you look at that guide rate, our previous historical run rate was 75-110. So it's really bringing in that top end down 10% or 10 basis points. And I think importantly, as we went through the budgeting process space by space, as we always have done, there's not a lot of disruption in the future that we're seeing. So we feel really comfortable where we are within our guidance range. Thank you very much. Good luck in 2026. Thanks, Michael. We appreciate it. Our next question comes from a line of Todd Thomas with KeyBanc. Please proceed with your question. Hi. Thanks. Good morning. I wanted to ask about the acquisition environment and thoughts on investments and capital recycling activity going forward. Brian, you touched on this in your prepared remarks, and maybe Mark can weigh in as well. But just wanted to get your thoughts on the pipeline heading into 2026 in terms of volume and pricing. And then second part, Steve, in the guidance reconciliation, it looks like there is $0.01 of growth related to transactions. Can you just speak to that, whether that's based on 2025 activity or if there's something implied from the forecast as a result of that? Thanks for the question, Todd. Maybe I'll touch briefly at the start. We just have been very encouraged by what we've been seeing on the transaction front. What's interesting is 40% of the volume that Mark has done since he's been here has happened in the last five quarters because in a very competitive environment, we found opportunities to put the platform to work. And that's really what you saw last year and what we expect to see going forward. But Mark, why don't you touch on more of the overall environment? Yeah. I think you're right. As far as the pipeline goes, it continues to grow. And one of the things that's really paying dividends for us is some of the direct marketing we're doing to some of the private ownership groups. So expect us, as we think about that pipeline, to remain opportunistic, as Brian highlighted in his opening remarks, as we do think external growth today is a great lever for us to drive additional value beyond the growth in our base portfolio. However, I would highlight that the first dollar of free cash flow is going to go to redevelopment given the great returns and yields we see in that part of our business. From an overall market perspective, we're certainly seeing cap rate compression across basically all asset types in open-air retail today. That's been driven by an increasing amount of private capital, pension fund capital being directed towards our space given the great returns that Brixmor and the REITs have been delivering in the space. A lot of that capital that's coming in is directed towards smaller grocery anchor deals and unanchored strip. That's driving cap rates in that piece of the business down into the fives for certain high-demand markets like the Southeast and California. We continue to see smaller bid lists for larger deals like a Chino that we bought last year that really have an operating nature to the business, which fits well for the Brixmor platform. Yeah. And on the guidance front, I mean, that walkdown's really sort of a growth-up approach just to help people understand the components, not necessarily from a capital allocation. I think when you're just, and Mark has touched on this in previous calls. I think you'd expect it to be sort of neutral in the initial year. And then I think, importantly, the growth profile of those assets we're acquiring are going to grow more than those assets that we're selling. Okay. Thank you. Thanks, Todd. Our next question comes from a line of Haendel St. Juste with Mizuho. Please proceed with your question. Hey, guys. Thanks for taking the question. I wanted to go back to the guide for a bit. I was hoping you could expound on some of the assumptions, particularly as it relates to the upper end of the same-property NOI guide. It seems a little conservative relative to what you put up last year. You mentioned 450 basis points of base rent growth, I think. There's a lower tenant credit risk backdrop. You have lower occupancy. So just curious if you could maybe give some more color on the pathway or what's embedded at the upper end. Thanks. Yeah. I mean, to get to the upper end, really, I think, especially within the same property NOI, it's kind of the same as every year, right? It's the team continue and you saw it in 2025. The team continue to execute on getting that SNO pipeline executed or sorry, commenced as early as possible and then continue to backfill that pipeline as we move throughout the year. I mean, I think as far as the guide, you just look at we've talked a lot about the compounding of those rent commencements, and you're seeing that come through. But there is a small portion of 2025 income associated with some of those names that we talked about that we did recognize income in 2025 that you have to hurdle as you head into 2026. Yeah. I think Steve hit it, but you can really see the drivers in that walkdown. It's pretty much exactly those components in Same Property NOI. It's hitting our dates. What can we pull in potentially from 2027? How much are we continuing to drive rent growth? We feel really comfortable with the range and really pleased with how the team's been executing and feel like we're in a good spot as we head into the year. Great. Thank you. And congrats, Brian. Thanks, Haendel. I appreciate it. Our next question comes from a line of Michael Griffin with Evercore. Please proceed with your question. Great. Thanks. Brian, I know it's been a little over a month since you've been kind of in the permanent CEO role. I realize that Brixmor has a solid history of blocking and tackling, executing on operations, kind of making the main thing the main thing. But as you kind of get into the top job, are there any things, whether it's initiatives, how you're looking at the portfolio or platform maybe differently, that you want to kind of be able to put your mark on the company as you kind of take over in the top role? Michael, it's a great question. So I'd answer in a few ways. First, our strategy of reinvesting and aggressively operating our assets is not going to change. If anything, it's accelerating from here for all the work that we've done, meaning that we still have occupancy upside. We still have the ability to drive rents. And with the quality of tenants that we've attracted, we're going to continue to improve our assets going forward. That's going to continue to be the focus. We touched on transactions a bit earlier. I'm very encouraged by what we're seeing there. We're going to remain very disciplined. We don't need acquisitions to grow. But it has been an awesome opportunity for us with Mark partnering with our regional teams in markets that we know really well where we have an idea of how we can drive outsized value in a very competitive environment. And I think the third thing is, and I touched on it. We've always been big on technology here and focused on how we can make more data-driven decisions and really focused on that across the organization. And we've challenged leaders across the organization to really look at their business, look at ways to improve that through technology. And I mentioned a few of the early wins that we're seeing in lease abstraction, in leasing legal in terms of efficiency with our legal spend. We've been doing some work around tenant health analyses in the leasing team, particularly a lot of our junior members in terms of how they're deploying AI and automation, really more AI in terms of their leasing prospecting tool. So continue to lean in there. But overall, I mean, we're in a really good position as a team. I feel really grateful for how the company has grown during the time that I and a number of us in this room have been here. It's really kind of taking that and all the work that we've done to the portfolio and really turbocharging the business plan going forward. Great. Thanks so much. Thanks. Appreciate it, Michael. Our next question comes from a line of Craig Mailman with Citi. Please proceed with your question. Hey. Good morning, everyone. I kind of want to hit on the SNO pipeline. And I'm going to try to frame this in a way that's not too confusing. But just as you guys have talked about being a little bit more aggressive, maybe taking back space, which is driving some lease term fees, which would imply some opportunistic moves there that maybe are more accretive than bad debt coming down. The SNO pipeline has continued to increase as the lease rate has increased. I'm just kind of curious, though, the growth profile of the composition of the SNO pipeline with the ability to intentionally kind of replace tenants, remerchandise, have lower tenant credit. Is the next batch of kind of additions to the SNO pipeline just more accretive to FFO and then AFFO as you guys can kind of throttle CapEx? Or am I reading too much into this? I'm just trying to get a sense of the potential to kind of inflect higher here, even on the growth, particularly as FFO drops to the AFFO line. Craig, it's a great question. I think I understand what you're asking. So basically, at this point, if you think about the nature of that SNO pipeline, what I say is a few things. So the highest rents that we've ever had, right? They're some of the strongest tenants that we've ever had. And as Steve touched on, we're doing it more efficiently with less CapEx because of the environment and the competition for space, because of the fact that a lot of these retailers have taken on more construction work themselves and have been much more accommodating in terms of accepting existing conditions. So yes, those factors would lead us to, again, attracting stronger tenants at higher rents and doing it more efficiently going forward. What I would say is we've already been doing that, and you can expect us to continue to do that because of the position that we've put the portfolio in and the environment that you're seeing. Our tenants are thriving in this environment. Our centers are driving a significant amount of traffic. So we feel really good about the nature of that pipeline going forward. Thanks. Thanks, Craig. Our next question comes from a line of Juan Sanabria with BMO Capital Markets. Please proceed with your question. Hi. Good morning. Just hoping to talk a little bit about the term fees in the fourth quarter. And it looks like there's kind of a change in the pace of non-cash rents that were kind of noted in guidance or aligned that in the guidance. So hoping you can give a little bit more color on the driver of the term fees and the expectations into 2026 and what impact, if at all, that had on the non-cash revenues as we think about sharpening our model for 2026. Thanks. Yeah. Juan, I'll let Steve hit on the non-cash. But let me just touch on term fees. If you take a step back, without term fees, the core business would have grown in line with where we grew, Same Property NOI at over 4% despite the fact that we took back 1.5 million sq ft of anchor space during the year. It would grow even more in 2026. We had a very unique opportunity in the fourth quarter in a center that we own in the East Bay area where we controlled the whole site, taking back the Kohl's and the Party City. We have tremendous optionality. We could do a retail plan today as we have LOIs for all that space. Or alternatively, there may be an opportunity for us to get the land rezoned for residential. Because of that timing, it was very opportunistic for us to take what is an outsized term fee. The amount of that probably wouldn't have been there if we had waited until we got the property rezoned. So the team did a fantastic job in terms of the timing of execution. In a normal course year, this portfolio has been generating, call it, $4 million-$6 million of term fees. It's a mix from tenants that have left where we've done settlements and others in an environment where there is a significant amount of demand that we can accretively backfill space. So expect us to continue to be opportunistic there. What you're seeing in that walkdown is specific to that large term fee that we took in the fourth quarter. And it was a very, very unique situation. So Steve, why don't you hit on the non-cash? Yeah. The non-cash, and we talked about it on previous calls, is really acceleration of 141 associated with some of the bankruptcies that we encountered throughout the year. So that was more focused on those tenants and not something that we expect to recur going forward. Our next question comes from a line of Greg McGinnis with Scotiabank. Please proceed with your question. Hello. This is Viktor Fedun with Greg McGinnis. Thanks for taking our question. In terms of external growth, so Q4 acquisitions seem to feed that traditional grocery anchor mold. And are you seeing better risk-adjusted returns in these core grocery assets right now compared to the value-add lifestyle opportunities you discussed earlier in 2025? I'll let Mark take that. Yeah. I think if you look at what we've been buying over the years, our focus is actually pretty simple. We're trying to find assets within our footprint where we can really drive outsized ROIC opportunities. So if you think back to 2024, we bought an asset in Tampa called Britton Plaza, which was a classic opportunistic deal where we purchased the land very attractively. We have a big redevelopment opportunity there that we're working on getting into the pipelines quickly as we can. Moving to 2025, if you look at the range of assets we bought, we did buy Lifestyle Center in Houston. We bought a traditional grocery anchor deal in Denver. And we bought Chino at the end of the year, which is on the West Coast in L.A. All those assets have great opportunities for the Brixmor platform to apply our platform to drive higher yields going in, drive longer-term growth. That's what we're really focused on, not necessarily the asset type. We're looking for growth that occurs in our footprint and where we can apply our platform that may be in a lifestyle center with great growth opportunities like LaCenterra. Or it could be a great redevelopment opportunity like Britton. Thank you. Our next question comes from a line of Caitlin Burrows with Goldman Sachs. Please proceed with your question. Hi, everyone. Good morning. Maybe another question on the SNO pipeline. So it's off its highs as economic occupancy has gone up, which is great. But I guess looking forward, when you consider leasing demand and the amount of vacancy that you do have, what is your view on the SNO pipeline replenishing itself kind of as we go forward? Yeah. Caitlin, we remain very encouraged with the demand environment. That SNO pipeline has been fairly sticky at around $60 million, even though we've been commencing anywhere from $15 million to $20 million-$22 million a quarter because we've been replenishing it. So the conversations we're having with retailers, retailers that are thriving and continuing to drive traffic to their stores, they're looking to open store count in an environment where there's not a lot of space. So we feel pretty confident in terms of our ability to continue to replenish that. I mentioned occupancy upside. We're still 50 basis points below the prior peak from a leased occupancy perspective. And that was by no means a cap on the portfolio because the portfolio is in a much better position today. Really feel very encouraged about what we're seeing from an overall demand environment as we move into the year to replenish the pipeline. Our next question comes from a line of Samir Khanal with Bank of America. Please proceed with your question. Yeah. Good morning, everybody. I guess, Steve, just curious on the other revenue ancillary income component. I guess what's assumed as part of guidance this year? I know last quarter, you talked about the parking agreement. That benefited some of this quarter. How should we think about that sort of line item of other revenue as we think about 2026? Thanks. Yeah. I think the things we were trying to highlight in the script is really the focus of the entire organization and maximizing revenue across our properties. We have a very, very strong ancillary team in-house that this is their main focus is driving that type of income. So one example of that was the Pointe Orlando garage, which is a recurring item. I tried to break that out a little separately so you all could see that contribution from that. But in that other bucket, you still see even though some of those were some of that revenue was more focused on the boxes we got back in the year, there are always those opportunities across the portfolio. So it's not a line item we necessarily give guidance on. I don't think it'll meaningfully move the range one way or the other as we continue to just find additional opportunities across the portfolio to maximize income. And, Samir, I would just add Steve hit on it. But this is a team of operators. And so as we look to create value in our assets and mine income opportunities to drive revenue, we're seeing higher rents in terms of electric car charging stations. We're seeing higher rents in terms of our solar. We're seeing very interesting uses in terms of that temp inline space. So from that perspective, the specialty team's done a great job. And as part of the realignment a few years ago, we partnered that more with the operating platform. So there's a lot of collaboration with our property management teams, with our leasing teams in the region. They're working side by side. And so you really saw that come through. Steve did point out some large one-time items, not really one-time, but larger items that contributed. But the nature of that is going to be recurring. So we feel really good about the trends in the specialty business going forward, but more importantly, how our team's working together to drive value. Our next question comes from a line of Cooper Clark with Wells Fargo. Please proceed with your question. Great. Thanks for taking the question. I know we touched on the acquisition side earlier. So curious if you could comment on the disposition pipeline as it stands today in terms of volumes and how we should think about the disposition cadence throughout the year given some of the strength in market pricing and opportunity to reinvest accretively with your redevelopment pipeline. Also curious on the depth of bidder pools and what buyers you're seeing most aggressively pursue deals. Yeah. Sure. For the dispos, what's really interesting about the dispo market is really the demand that we're seeing in the market today. So last year, the dispos we sold were blending to a low 7 cap rate. The market's really allowing us to exit assets at better-than-expected cap rates for assets where we see lower growth and would really be near the bottom of our portfolio in terms of value creation from our perspective. What's important from our perspective is that we remain very confident in our ability to sell these lower-growth assets and recycle that capital into higher-growth opportunities like a Chino, like a Broomfield, where we're really seeing dispos underwrite. We think the buyers are underwriting IRRs in that mid-7% to 8% range. And we're really buying assets from our perspective with IRRs that are generally blending in that high 9%-10% range. So we remain really convicted in that part of the trade we're making. As far as bid lists, it's really dependent on size. So one of the things you've seen is a lot of money raised to try to buy open-air grocery anchored centers. I think a lot of that capital was focused on one quality of assets. They've seen cap rate compressed. And they've had to go after a slightly lower demographic, a slightly lower gross performance. And that's really allowing us to drive cap rate on what we're selling at the bottom part of our portfolio. In terms of who those are, it's pension funds. It's high net worth. You're seeing local groups come back out of the woodwork. So it's a really healthy market today. As I mentioned earlier, the biggest difference is really size. So when you're selling a $5 million asset, the bid pool's very large. When you get up to a Chino, which was $140 million or $138 million, that bid list was actually quite small and really allowed us to find a great opportunity to drive higher IRRs given the demand there. So we remain really convicted about our ability to sell, again, lower IRR and buy higher IRR. We're really excited about that opportunity. Our next question comes from a line of Connor Mitchell with Piper Sandler. Please proceed with your question. Hey. Thanks for taking my question. Just going back to the bad debt outlook for this year and just kind of thinking about the watchlist, you mentioned that you've had limited exposure to pharmacies or theaters. But just wondering if you could kind of put some context around the general watchlist and what you're seeing within your portfolio, whether that's maybe a majority of the watchlist or higher up on the watchlist are kind of one-off situations where there's upcoming debt maturities and it's more of a balance sheet issue, and that's the worry, or if more of those tenants, retailers are kind of more within a theme or a service type kind of group together. Yeah. Connor, it's a good question. And it's something that we are always watching. This team historically has been very proactive in terms of addressing things ahead of potential credit events. Many of you on the call today have screened watchlists across our peer set. And if you look at where ours is today, we screen very favorably in terms of those categories that I mentioned. The other thing that we feel very confident about is a few years ago, we put very stringent underwriting standards in place, the most stringent the company's ever had with our finance team and our leasing teams in terms of underwriting small shop tenancy. And what we saw there was who was taking space was multi-unit operators established that had much stronger credit profiles than we had seen historically. It's why we have so many multi-unit operators in that space. So we still have a tenant health call with our team. Steve and I review it on a monthly basis. Our teams are reviewing it daily. And the trends we see are very positive. We're not seeing an uptick in delinquencies. We're not seeing an uptick in move-outs, normal course move-outs for the portfolio last year if you take away the bankruptcies. We're again at historic lows for the portfolio, retention rates up, renewal growth in the mid-teens. So I think all those trends give you visibility into the health of the portfolio. There's always a handful of names that we're watching. It just tends to be very low for us at this point. Our next question comes from a line of Michael Mueller with JPMorgan. Please proceed with your question. Yeah. Hi. Can you talk a little bit more about, I guess, using tech and AI to evaluate tenant health? And has it changed your watchlist in any material way as a result of the approach? Yeah. One of the things we're looking at, Mike, it's a great question, is not, I mean, you all on the phone have the names you may be watching or the categories that I mentioned. But it's really those where can we start to get some early signals, right, that's not just, "Hey, well, the tenant got a default this month," or, "The tenant was a little bit late." Can we start to see where that payment date goes from the third date to the fifth date? It's things like that relative that we've started to roll out. We're seeing some pretty interesting trends. And we can at least start to have a conversation with people ahead of time. I think that's just one example of how we're using all the data that we have across the entire platform to just make more data-informed, data-driven decisions.So it's something that was a big focus of ours as part of the realignment to get consistency in the types of dashboards that we're using to measure our tasks and to measure our improvement in certain operating metrics as we go throughout the year. So that's just one aspect of it. And I think as we continue to deploy things throughout the year, we'll continue to share some of the benefits. But I'm really pleased at how the team has adopted this mindset and how we're pushing things forward really across the platform. As a reminder, if you would like to ask a question, press star one on your telephone keypad. Our next question comes from a line of Linda Tsai with Jefferies. Please proceed with your question. Thanks for taking my question. The improved retention rate of 87%, I guess that helps support the record low CapEx down 14% year-over-year. How sustainable do you view lower CapEx spend if you had to look out a few years? We certainly see it at this run rate, Linda. It's a great question in terms of where we are. So I kind of break it down a few ways. We still plan. We think it's a great use of capital for accretive reinvestment. I think where we have seen the declines is on the leasing side where competition for space and improvement in the portfolio has allowed us to reduce CapEx in those deals while still growing rents significantly. I also think, again, retailers, and you're seeing it. You saw it last year in the auctions, have been much more willing to take on existing space and much more flexible in terms of those buildouts. So that's driving it as well. The deferred maintenance overhang of this portfolio is behind us from a maintenance CapEx perspective. This is now 3 years running of maintenance CapEx lowest for the portfolio, the lowest since 2016 outside of the pandemic year. We have been very intentional. You're thinking now it's more roofs and parking lots. But even within that, the fact that we're doing portfolio-wide roofing bids, the fact that our property managers are working with our redevelopment teams in terms of some of the things that we may need to improve in those reinvestments to avoid future CapEx going forward, and then you just look about it and then you look at it on the expense side as well from a recovery rate, all the work that we've done in cleaning up our CAM clauses has allowed us to get paid back for the operating expense investment that we've been making in our assets. You put that all together, in addition to the environment, it's leading to lower CapEx. We feel like we're in a good position right now as we go forward. Thanks for the color. Good luck. Thanks, Linda. Appreciate it. Our next question comes from a line of Paulina Rojas with Green Street. Please proceed with your question. Good morning. My question is about dispositions. I find interesting that some of the assets that you have sold had low occupancy. Westchester Square, Springdale, and a few others sold earlier in the year, not too many but some, which would suggest that perhaps those assets had remaining upside. So my question is, did these centers have anything in common that made it more compelling to pursue a sale rather than driving additional occupancy internally, particularly given the good leasing momentum? Yeah. It's a great question. And I think you've seen a mix there historically, Paulina, of several centers too that we had during the year that were close to 100% occupied. I think we are focused on ROI. And so yes, there was some vacancy. But we just answered a question about CapEx. Are we going to put those dollars to work accretively? And you've seen us do that across the portfolio. But in areas where we don't see the ability to do that accretively, we say to ourselves, "Hey, how does the hold decision compare to the sale decision? Are we better off recycling the capital somewhere else?" And as Mark spent some time going through, we're seeing some great bids for assets. So we can take that capital and deploy it elsewhere where we can get a more accretive return. So that's really it. I mean, if you look at it, occupancy impact from dispositions was a very, very small percentage during the year. That wasn't the motivating factor there. It was, A, they were in markets where we don't have a huge presence in those two assets in particular. But more importantly, we just didn't see the ROI and the investment that we would have to make to drive that occupancy forward at those centers. Our next question comes from a line of Tayo Okusanya with Deutsche Bank. Please proceed with your question. Yes. Good morning, everyone. Again, congrats, Brian and Stacy. No one is more deserving. Congrats to you as well. Just a question around, again, fundamentals in the strip side just kind of seem very strong across the board. And I'm just curious, as you kind of think about the industry as a whole and yourself and all your peers, I mean, are we setting up for a year where it's kind of rising tides lifts all boats? Or fundamentally, do you think we're still going to see differences across all the key platforms? And in this kind of environment, what really are the key things in your mind that would lead to greater success versus another operator in this space? Yeah. It's a great question. There's no doubt the environment is strong. I think we're as well positioned as anybody in terms of all the things that we've been talking about on this call relative to the low-rent basis, the occupancy upside, the visibility on the strength of the redevelopment pipeline. We haven't spent a ton of time on this today. In what we already own and control, you think about the projects that we've got with Publix, the one that we just launched this quarter in Metro New York, the one that Mark bought last year in South Tampa, Plano, Texas. We're going to be opening up our first large-format Target in Dallas in a couple of weeks. We're very excited about the nature of that pipeline going forward. I think if you look at the ability to grow and the ability to do that incrementally and accretively, I think we stand apart. Yes, the environment's strong. Our retailers are performing. I think the position that we've put the portfolio in really allows us to capitalize on that going forward. Our next question is a follow-up from Caitlin Burrows with Goldman Sachs. Please proceed with your question. Hi again. You guys mentioned earlier how the balance sheet set net debt to EBITDA of 5.4x. I guess how are you thinking of that and where you want to be? Is lower better? Or are you in the right range? Or would you be okay going higher? Yeah. I think Brian mentioned it in his remarks. I mean, we continue to be very disciplined with the balance sheet. I think where we are in the mid-fives, based on the amount of growth that we see coming, we feel very well positioned here. But obviously, we'll keep an eye on it as we move through the year. But I think we're pretty comfortable here in the mid-fives. Our next question is a follow-up from Paulina Rojas with Green Street. Please proceed with your question. Thank you. I wanted to follow up on your comments about the improved tenant quality. I think you mentioned that roughly 75, I think you said, of the small shop tenants are multi-unit operators. Can you put some historical context on that metric so we can better compare and contrast the improvement over time? Yeah. I think it's certainly up from where it was. We can get to the exact number. I think one of the things that we've seen there, Paulina, because we've seen a reduction just in kind of that true one-off local tenancy. It's down to 17% of our ABR. One of the reasons that we wanted to highlight it is because as we were digging through and this came up as, again, part of some of the data work that we've been doing across the portfolio was we were really not surprised by it because we're seeing it come through in our leasing committee. But it really kind of reassured the thoughts that we had about the trajectory of the portfolio and the fact that we did have more established small shop tenants in particular that were successful, right? And it tied to everything else we've been talking about relative to the strong payment trends, relative to the record small shop rents that we've been able to achieve. And then if you just think of the overall quality of tenants that we're adding to the portfolio, you look at those higher-quality QSRs, right? There is a focus on health and wellness. And whether it's the strong regional operators like NAYA and honeygrow or the CAVAs or the Tatte Bakeries that we're attracting to the portfolio, then you look at some higher-end tenants like Sephora, Warby Parker that we just added our first locations to. We opened a Capital Grille last year in a grocery-anchored shopping center in suburban Philadelphia. So these are names that maybe seven, eight years ago, we would not have been attracting to the portfolio. I think it speaks to all the work that the team has done on the reinvestment front, the fact that consumers in the markets in which we own shopping centers are just demanding more from those markets in terms of the quality of restaurants and the quality of services. So it gives us the opportunity to provide that. Overall, I think you can see it come through in the types of tenants, the names of the tenants who we're signing, and then just the strength of that tenancy coming through in the rest of the operating metrics. Thank you. Thanks, Paulina. We have no further questions at this time. Ms. Slater, I'd like to turn the call back over to you for closing comments. Great. Thank you all for joining us today. We look forward to seeing many of you over the next few weeks. Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation, and have a wonderful day.

Speaker 13: Greetings and welcome to the Brixmor Property Group fourth quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Stacy Slater. Thank you. You may begin. Greetings and welcome to the Brixmor Property Group fourth quarter 2025 earnings conference call. greetings and welcome to the brixmor property group fourth quarter 2025 earnings conference call At this time, all participants are in a listen-only mode. at this time all participants are in a listen-only mode A brief question-and-answer session will follow the formal presentation. a brief question-and-answer session will follow the formal presentation If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. if anyone should require operator assistance during the conference please press star zero on your telephone keypad As a reminder, this conference is being recorded. as a reminder this conference is being recorded It is now my pleasure to introduce your host, Stacy Slater. it is now my pleasure to introduce your host stacy slater Thank you. thank you You may begin. you may begin

Speaker 16: Thank you, operator, and thank you all for joining Brixmor's fourth quarter conference call. With me on the call today are Brian Finnegan, CEO and President, and Steve Gallagher, Chief Financial Officer. Mark Horgan, Executive Vice President and Chief Investment Officer, will also be available for Q&A. Before we begin, let me remind everyone that some of our comments today may contain forward-looking statements that are based on certain assumptions and are subject to inherent risks and uncertainties. As described in our SEC filings, an actual future result may differ materially. We assume no obligation to update our forward-looking statements. Also, we will refer today to certain non-GAAP financial measures. Thank you, operator, and thank you all for joining Brixmor's fourth quarter conference call. thank you operator and thank you all for joining brixmor's fourth quarter conference call With me on the call today are Brian Finnegan, CEO and President, and Steve Gallagher, Chief Financial Officer. with me on the call today are brian finnegan ceo and president and steve gallagher chief financial officer Mark Horgan, Executive Vice President and Chief Investment Officer, will also be available for Q&A. mark horgan executive vice president and chief investment officer will also be available for q&a Before we begin, let me remind everyone that some of our comments today may contain forward-looking statements that are based on certain assumptions and are subject to inherent risks and uncertainties. before we begin let me remind everyone that some of our comments today may contain forward-looking statements that are based on certain assumptions and are subject to inherent risks and uncertainties As described in our SEC filings, an actual future result may differ materially. as described in our sec filings an actual future result may differ materially We assume no obligation to update our forward-looking statements. we assume no obligation to update our forward-looking statements Also, we will refer today to certain non-GAAP financial measures. also we will refer today to certain non-gaap financial measures Further information regarding our use of these measures and reconciliations of these measures to our GAAP results is available in the earnings release and supplemental disclosure on the investor relations portion of our website. Given the number of participants on the call, we kindly ask that you limit your questions to one per person. If you have additional questions, please re-queue. At this time, it's my pleasure to introduce Brian Finnegan. Further information regarding our use of these measures and reconciliations of these measures to our GAAP results is available in the earnings release and supplemental disclosure on the investor relations portion of our website. further information regarding our use of these measures and reconciliations of these measures to our gaap results is available in the earnings release and supplemental disclosure on the investor relations portion of our website Given the number of participants on the call, we kindly ask that you limit your questions to one per person. given the number of participants on the call we kindly ask that you limit your questions to one per person If you have additional questions, please re-queue. if you have additional questions please re-queue At this time, it's my pleasure to introduce Brian Finnegan. at this time it's my pleasure to introduce brian finnegan

Speaker 1: Thank you, Stacy, and good morning, everyone. I am thrilled to join you today for my first call as permanent CEO of Brixmor, a company that has been my professional home for more than 21 years. Before touching on our results for the quarter and the year, I will share a few comments on our leadership succession and strategy going forward. First, a sincere thank you to Jim Taylor for his extraordinary leadership and mentorship. His impact on Brixmor and our industry is immense, and I was proud to be by his side for the last 9.5 years as we dramatically transformed this portfolio. We wish him the very best in his retirement. I also want to thank the board for their confidence and the Brixmor team for their support. Thank you, Stacy, and good morning, everyone. thank you stacy and good morning everyone I am thrilled to join you today for my first call as permanent CEO of Brixmor, a company that has been my professional home for more than 21 years. i am thrilled to join you today for my first call as permanent ceo of brixmor a company that has been my professional home for more than 21 years Before touching on our results for the quarter and the year, I will share a few comments on our leadership succession and strategy going forward. before touching on our results for the quarter and the year i will share a few comments on our leadership succession and strategy going forward First, a sincere thank you to Jim Taylor for his extraordinary leadership and mentorship. first a sincere thank you to jim taylor for his extraordinary leadership and mentorship His impact on Brixmor and our industry is immense, and I was proud to be by his side for the last 9.5 years as we dramatically transformed this portfolio. his impact on brixmor and our industry is immense and i was proud to be by his side for the last 9.5 years as we dramatically transformed this portfolio We wish him the very best in his retirement. we wish him the very best in his retirement I also want to thank the board for their confidence and the Brixmor team for their support. i also want to thank the board for their confidence and the brixmor team for their support I am grateful to step into this role at a moment of real strength for the company. Our portfolio transformation and disciplined execution position us exceptionally well to accelerate our growth going forward. The fundamentals for open-air, grocery-anchored retail remain favorable. Consumers have been resilient. Thriving tenants are expanding their physical store presence, and new retail supply remains at historic lows. Against this backdrop, the Brixmor operating platform stands out as our low-rent basis continues to provide industry-leading mark-to-market opportunity while our future reinvestment and sign-but-not-commence pipelines provide unmatched visibility on future growth and cash flows. We do not anticipate any changes to our operating model in the near term outside of a few of our talented leaders taking on more responsibilities. I am grateful to step into this role at a moment of real strength for the company. i am grateful to step into this role at a moment of real strength for the company Our portfolio transformation and disciplined execution position us exceptionally well to accelerate our growth going forward. our portfolio transformation and disciplined execution position us exceptionally well to accelerate our growth going forward The fundamentals for open-air, grocery-anchored retail remain favorable. the fundamentals for open-air grocery-anchored retail remain favorable Consumers have been resilient. consumers have been resilient Thriving tenants are expanding their physical store presence, and new retail supply remains at historic lows. thriving tenants are expanding their physical store presence and new retail supply remains at historic lows Against this backdrop, the Brixmor operating platform stands out as our low-rent basis continues to provide industry-leading mark-to-market opportunity while our future reinvestment and sign-but-not-commence pipelines provide unmatched visibility on future growth and cash flows. against this backdrop the brixmor operating platform stands out as our low-rent basis continues to provide industry-leading mark-to-market opportunity while our future reinvestment and sign-but-not-commence pipelines provide unmatched visibility on future growth and cash flows We do not anticipate any changes to our operating model in the near term outside of a few of our talented leaders taking on more responsibilities. we do not anticipate any changes to our operating model in the near term outside of a few of our talented leaders taking on more responsibilities Specifically, congratulations to Stacy Slater on her promotion to Executive Vice President, Capital Markets, Corporate Strategy and Investor Relations, and Matt Ryan, who will expand his role as South Region President to include National Property Operations. Both will join our executive committee. More broadly, the operational realignment we implemented 18 months ago, consolidating from four to three regions, continues to pay dividends through greater efficiency, stronger leasing execution, and disciplined capital allocation. We are also leaning in further to technology and analytics. Early initiatives in AI and automation are already yielding positive results in areas such as lease abstraction and summarization, tenant health analyses, and leasing prospecting tools. Externally, we are going to remain disciplined but opportunistic. Specifically, congratulations to Stacy Slater on her promotion to Executive Vice President, Capital Markets, Corporate Strategy and Investor Relations, and Matt Ryan, who will expand his role as South Region President to include National Property Operations. specifically congratulations to stacy slater on her promotion to executive vice president capital markets corporate strategy and investor relations and matt ryan who will expand his role as south region president to include national property operations Both will join our executive committee. both will join our executive committee More broadly, the operational realignment we implemented 18 months ago, consolidating from four to three regions, continues to pay dividends through greater efficiency, stronger leasing execution, and disciplined capital allocation. more broadly the operational realignment we implemented 18 months ago consolidating from four to three regions continues to pay dividends through greater efficiency stronger leasing execution and disciplined capital allocation We are also leaning in further to technology and analytics. we are also leaning in further to technology and analytics Early initiatives in AI and automation are already yielding positive results in areas such as lease abstraction and summarization, tenant health analyses, and leasing prospecting tools. early initiatives in ai and automation are already yielding positive results in areas such as lease abstraction and summarization tenant health analyses and leasing prospecting tools Externally, we are going to remain disciplined but opportunistic. externally we are going to remain disciplined but opportunistic Under Mark's leadership, we were net acquirers in four of the last five years, with 2025 being our most active year as a public company at approximately $420 million of asset value acquired in Houston, Southern California, and Denver. We expect to continue allocating capital towards opportunities where our platform can create outsized value without having to rely on acquisitions for growth, and we are mindful of our balance sheet in every capital allocation decision we make. Now let's turn to our results for the quarter and the year, which were exceptional. As Steve will touch on further, same property NOI grew by 4.2% for the year, even as we recaptured 1.5 million sq ft of anchor space. FFO for the year was at the high end of our guidance range at $2.25 per share and up 5.6% year-over-year. Under Mark's leadership, we were net acquirers in four of the last five years, with 2025 being our most active year as a public company at approximately $420 million of asset value acquired in Houston, Southern California, and Denver. under mark's leadership we were net acquirers in four of the last five years with 2025 being our most active year as a public company at approximately $420 million of asset value acquired in houston southern california and denver We expect to continue allocating capital towards opportunities where our platform can create outsized value without having to rely on acquisitions for growth, and we are mindful of our balance sheet in every capital allocation decision we make. we expect to continue allocating capital towards opportunities where our platform can create outsized value without having to rely on acquisitions for growth and we are mindful of our balance sheet in every capital allocation decision we make Now let's turn to our results for the quarter and the year, which were exceptional. now let's turn to our results for the quarter and the year which were exceptional As Steve will touch on further, same property NOI grew by 4.2% for the year, even as we recaptured 1.5 million sq ft of anchor space. as steve will touch on further same property noi grew by 4.2% for the year even as we recaptured 1.5 million sq ft of anchor space FFO for the year was at the high end of our guidance range at $2.25 per share and up 5.6% year-over-year. ffo for the year was at the high end of our guidance range at $2.25 per share and up 5.6% year-over-year We delivered a record leasing year with $70 million of new rent executed, small shop occupancy increasing to a new high of 92.2%, and ended the year with the largest sequential overall occupancy gain in the company's history, up 100 basis points to 95.1%. Demand from high-quality tenants remains robust. As within the over 3 million sq ft of new leases executed last year, we signed 8 new grocer leases with strong operators such as Publix, Sprouts, and Big Y, and multiple leases with each of the leading retailers in the off-price segment. From a small shop standpoint, we continue to be impressed by the depth and credit quality of the operators in the health and wellness, quick service restaurant, and service segments as we continue to attract a higher caliber tenant to this portfolio. We delivered a record leasing year with $70 million of new rent executed, small shop occupancy increasing to a new high of 92.2%, and ended the year with the largest sequential overall occupancy gain in the company's history, up 100 basis points to 95.1%. we delivered a record leasing year with $70 million of new rent executed small shop occupancy increasing to a new high of 92.2% and ended the year with the largest sequential overall occupancy gain in the company's history up 100 basis points to 95.1% Demand from high-quality tenants remains robust. demand from high-quality tenants remains robust As within the over 3 million sq ft of new leases executed last year, we signed 8 new grocer leases with strong operators such as Publix, Sprouts, and Big Y, and multiple leases with each of the leading retailers in the off-price segment. as within the over 3 million sq ft of new leases executed last year we signed 8 new grocer leases with strong operators such as publix sprouts and big y and multiple leases with each of the leading retailers in the off-price segment From a small shop standpoint, we continue to be impressed by the depth and credit quality of the operators in the health and wellness, quick service restaurant, and service segments as we continue to attract a higher caliber tenant to this portfolio. from a small shop standpoint we continue to be impressed by the depth and credit quality of the operators in the health and wellness quick service restaurant and service segments as we continue to attract a higher caliber tenant to this portfolio The strength of our small shop tenancy is also evidenced by the fact that 70% of our small shop rent is derived from multi-unit operators. Our team also continued to capture the mark-to-market upside in the portfolio, with new lease rent growth for the year at 39% and renewal rent growth for the year at 15%, resulting in our third consecutive year of mid-teens renewal growth. We also saw improvement in our retention rate, which at year-end was 87%, a 180 basis point improvement from last year. Switching to operations, we continued to deploy capital efficiently and leverage competition for space to reduce our deal costs, with overall CapEx spending down 14% year-over-year and the lowest since 2021, while maintenance CapEx spending was at our lowest level since 2016 outside of the pandemic year. The strength of our small shop tenancy is also evidenced by the fact that 70% of our small shop rent is derived from multi-unit operators. the strength of our small shop tenancy is also evidenced by the fact that 70% of our small shop rent is derived from multi-unit operators Our team also continued to capture the mark-to-market upside in the portfolio, with new lease rent growth for the year at 39% and renewal rent growth for the year at 15%, resulting in our third consecutive year of mid-teens renewal growth. our team also continued to capture the mark-to-market upside in the portfolio with new lease rent growth for the year at 39% and renewal rent growth for the year at 15% resulting in our third consecutive year of mid-teens renewal growth We also saw improvement in our retention rate, which at year-end was 87%, a 180 basis point improvement from last year. we also saw improvement in our retention rate which at year-end was 87% a 180 basis point improvement from last year Switching to operations, we continued to deploy capital efficiently and leverage competition for space to reduce our deal costs, with overall CapEx spending down 14% year-over-year and the lowest since 2021, while maintenance CapEx spending was at our lowest level since 2016 outside of the pandemic year. switching to operations we continued to deploy capital efficiently and leverage competition for space to reduce our deal costs with overall capex spending down 14% year-over-year and the lowest since 2021 while maintenance capex spending was at our lowest level since 2016 outside of the pandemic year In addition, disciplined operating expense spending resulted in a record expense recovery ratio at year-end of 92.3%. On the reinvestment front, we stabilized $183 million of projects in 2025 at an attractive 10% incremental yield. This included some of the most impactful projects in the company's history, such as The Davis Collection, where we tore down an obsolescent anchor adjacent to a high-performing Trader Joe's grocer and delivered a new Nordstrom Rack, Ulta, J.Crew Factory, Mendocino Farms, Urban Plates, and several other exciting tenants across the street from UC Davis. At year-end, we had $336 million in the active pipeline, including Rockland Plaza, which we added to the active pipeline this quarter as we kick off the redevelopment of this well-located center in the New York Metro area with Nordstrom Rack, Ross Dress for Less, Burlington, and new out-parcel buildings and several exciting shop tenants. In addition, disciplined operating expense spending resulted in a record expense recovery ratio at year-end of 92.3%. in addition disciplined operating expense spending resulted in a record expense recovery ratio at year-end of 92.3% On the reinvestment front, we stabilized $183 million of projects in 2025 at an attractive 10% incremental yield. on the reinvestment front we stabilized $183 million of projects in 2025 at an attractive 10% incremental yield This included some of the most impactful projects in the company's history, such as The Davis Collection, where we tore down an obsolescent anchor adjacent to a high-performing Trader Joe's grocer and delivered a new Nordstrom Rack, Ulta, J.Crew Factory, Mendocino Farms, Urban Plates, and several other exciting tenants across the street from UC Davis. this included some of the most impactful projects in the company's history such as the davis collection where we tore down an obsolescent anchor adjacent to a high-performing trader joe's grocer and delivered a new nordstrom rack ulta j.crew factory mendocino farms urban plates and several other exciting tenants across the street from uc davis At year-end, we had $336 million in the active pipeline, including Rockland Plaza, which we added to the active pipeline this quarter as we kick off the redevelopment of this well-located center in the New York Metro area with Nordstrom Rack, Ross Dress for Less, Burlington, and new out-parcel buildings and several exciting shop tenants. at year-end we had $336 million in the active pipeline including rockland plaza which we added to the active pipeline this quarter as we kick off the redevelopment of this well-located center in the new york metro area with nordstrom rack ross dress for less burlington and new out-parcel buildings and several exciting shop tenants Behind the active pipeline, our deep shadow pipeline of projects, including several more with Publix, provides us years of runway for value-creating redevelopment in what we already own and control. Moving to our transaction activity, we acquired 2 high-quality grocery-anchored centers in Denver and Southern California in the fourth quarter. Both have immediate leasing and mark-to-market upside, are accretive to our long-term growth profile, and are in markets that our West Region team has created significant value in. We also completed $170 million of dispositions during the quarter, where we saw limited ROI going forward, including our last asset in Alabama. In closing, thanks to the Brixmor team's record performance, we entered 2026 with tremendous momentum in the business. Behind the active pipeline, our deep shadow pipeline of projects, including several more with Publix, provides us years of runway for value-creating redevelopment in what we already own and control. behind the active pipeline our deep shadow pipeline of projects including several more with publix provides us years of runway for value-creating redevelopment in what we already own and control Moving to our transaction activity, we acquired 2 high-quality grocery-anchored centers in Denver and Southern California in the fourth quarter. moving to our transaction activity we acquired 2 high-quality grocery-anchored centers in denver and southern california in the fourth quarter Both have immediate leasing and mark-to-market upside, are accretive to our long-term growth profile, and are in markets that our West Region team has created significant value in. both have immediate leasing and mark-to-market upside are accretive to our long-term growth profile and are in markets that our west region team has created significant value in We also completed $170 million of dispositions during the quarter, where we saw limited ROI going forward, including our last asset in Alabama. we also completed $170 million of dispositions during the quarter where we saw limited roi going forward including our last asset in alabama In closing, thanks to the Brixmor team's record performance, we entered 2026 with tremendous momentum in the business. in closing thanks to the brixmor team's record performance we entered 2026 with tremendous momentum in the business Our properties hosted over 9 million visits last year, and our tenant lineup reflects the strongest underlying credit profile in our company's history. The portfolio looks the best it ever has. Our balance sheet is in the strongest position it has ever been, and our platform is positioned to drive consistent, durable growth. I am so energized for what lies ahead and grateful to lead this team as we accelerate our business plan. With that, I'll hand the call over to Steve for a deeper review of our financial results and 2026 outlook. Steve? Our properties hosted over 9 million visits last year, and our tenant lineup reflects the strongest underlying credit profile in our company's history. our properties hosted over 9 million visits last year and our tenant lineup reflects the strongest underlying credit profile in our company's history The portfolio looks the best it ever has. the portfolio looks the best it ever has Our balance sheet is in the strongest position it has ever been, and our platform is positioned to drive consistent, durable growth. our balance sheet is in the strongest position it has ever been and our platform is positioned to drive consistent durable growth I am so energized for what lies ahead and grateful to lead this team as we accelerate our business plan. i am so energized for what lies ahead and grateful to lead this team as we accelerate our business plan With that, I'll hand the call over to Steve for a deeper review of our financial results and 2026 outlook. with that i'll hand the call over to steve for a deeper review of our financial results and 2026 outlook Steve? steve

Speaker 17: Thanks, Brian. The strength and resiliency of our business model were clearly evident in 2025. We executed consistently throughout the year despite the significant amount of space we recaptured, delivered 5.6% FFO growth, achieved 4.2% Same Property NOI growth, and meaningfully improved our underlying tenant profile. As a result, our portfolio is the strongest position it has ever been, and we are exceptionally well-positioned to capture the continued demand for well-located open-air retail centers. Fourth quarter, Same Property NOI increased 6%, supported by a 360 basis points contribution from base rent growth due to stacking rent commencements from late 2024 and all of 2025. Ancillary and other income contributed an additional 200 basis points, reflecting our team's proactive asset management initiatives to drive revenue across the portfolio. Thanks, Brian. thanks brian The strength and resiliency of our business model were clearly evident in 2025. the strength and resiliency of our business model were clearly evident in 2025 We executed consistently throughout the year despite the significant amount of space we recaptured, delivered 5.6% FFO growth, achieved 4.2% Same Property NOI growth, and meaningfully improved our underlying tenant profile. we executed consistently throughout the year despite the significant amount of space we recaptured delivered 5.6% ffo growth achieved 4.2% same property noi growth and meaningfully improved our underlying tenant profile As a result, our portfolio is the strongest position it has ever been, and we are exceptionally well-positioned to capture the continued demand for well-located open-air retail centers. as a result our portfolio is the strongest position it has ever been and we are exceptionally well-positioned to capture the continued demand for well-located open-air retail centers Fourth quarter, Same Property NOI increased 6%, supported by a 360 basis points contribution from base rent growth due to stacking rent commencements from late 2024 and all of 2025. fourth quarter same property noi increased 6% supported by a 360 basis points contribution from base rent growth due to stacking rent commencements from late 2024 and all of 2025 Ancillary and other income contributed an additional 200 basis points, reflecting our team's proactive asset management initiatives to drive revenue across the portfolio. ancillary and other income contributed an additional 200 basis points reflecting our team's proactive asset management initiatives to drive revenue across the portfolio NAREIT FFO was $0.58 per share in the fourth quarter, benefiting from strong Same Property NOI performance and elevated lease termination income. As we noted last quarter, we anticipated higher lease termination activity as we proactively recaptured space to unlock value creation opportunities across the portfolio, with the largest of these transactions in the Bay Area. Same Property NOI increased 4.2% for the year despite over 200 basis points of tenant disruption headwinds. Base rent contributed 360 basis points, and ancillary and other income added 110 basis points, driven equally by the updated recurring parking agreement at Pointe Orlando discussed on our prior calls and asset management initiatives. NAREIT FFO per share was $2.25, up 5.6% from last year, supported by broad-based operational strength across the portfolio. NAREIT FFO was $0.58 per share in the fourth quarter, benefiting from strong Same Property NOI performance and elevated lease termination income. nareit ffo was $0.58 per share in the fourth quarter benefiting from strong same property noi performance and elevated lease termination income As we noted last quarter, we anticipated higher lease termination activity as we proactively recaptured space to unlock value creation opportunities across the portfolio, with the largest of these transactions in the Bay Area. as we noted last quarter we anticipated higher lease termination activity as we proactively recaptured space to unlock value creation opportunities across the portfolio with the largest of these transactions in the bay area Same Property NOI increased 4.2% for the year despite over 200 basis points of tenant disruption headwinds. same property noi increased 4.2% for the year despite over 200 basis points of tenant disruption headwinds Base rent contributed 360 basis points, and ancillary and other income added 110 basis points, driven equally by the updated recurring parking agreement at Pointe Orlando discussed on our prior calls and asset management initiatives. base rent contributed 360 basis points and ancillary and other income added 110 basis points driven equally by the updated recurring parking agreement at pointe orlando discussed on our prior calls and asset management initiatives NAREIT FFO per share was $2.25, up 5.6% from last year, supported by broad-based operational strength across the portfolio. nareit ffo per share was $2.25 up 5.6% from last year supported by broad-based operational strength across the portfolio We commenced a record $70 million of ABR in 2025. We fully replenished that volume by executing another $70 million of net new rent, a clear indication of the depth and durability of demand. Our signed-but-not-yet commenced pipeline at year-end totaled $62 million at an average of $23 per sq ft and includes $50 million of net new rent. The spread between leased and built occupancy ended the period at 350 basis points, and we anticipate approximately $43 million of that signed-but-not-yet commenced pipeline to commence rapidly throughout 2026. The tailwinds created by the stacking of 2025 rent commencements, contributions from redevelopment, embedded rent bumps, and combined with the signed-but-not-yet commenced pipeline provide strong visibility into our 2026 outlook. We're guiding to 4.5%-5.5% same property NOI growth, driven by more than 450 basis points of expected base rent contribution. We commenced a record $70 million of ABR in 2025. we commenced a record $70 million of abr in 2025 We fully replenished that volume by executing another $70 million of net new rent, a clear indication of the depth and durability of demand. we fully replenished that volume by executing another $70 million of net new rent a clear indication of the depth and durability of demand Our signed-but-not-yet commenced pipeline at year-end totaled $62 million at an average of $23 per sq ft and includes $50 million of net new rent. our signed-but-not-yet commenced pipeline at year-end totaled $62 million at an average of $23 per sq ft and includes $50 million of net new rent The spread between leased and built occupancy ended the period at 350 basis points, and we anticipate approximately $43 million of that signed-but-not-yet commenced pipeline to commence rapidly throughout 2026. the spread between leased and built occupancy ended the period at 350 basis points and we anticipate approximately $43 million of that signed-but-not-yet commenced pipeline to commence rapidly throughout 2026 The tailwinds created by the stacking of 2025 rent commencements, contributions from redevelopment, embedded rent bumps, and combined with the signed-but-not-yet commenced pipeline provide strong visibility into our 2026 outlook. the tailwinds created by the stacking of 2025 rent commencements contributions from redevelopment embedded rent bumps and combined with the signed-but-not-yet commenced pipeline provide strong visibility into our 2026 outlook We're guiding to 4.5%-5.5% same property NOI growth, driven by more than 450 basis points of expected base rent contribution. we're guiding to 4.5%-5.5% same property noi growth driven by more than 450 basis points of expected base rent contribution We also expect net expense reimbursements will contribute to growth as we expect average built occupancy to increase over last year. Our continued transformation across the portfolio has meaningfully enhanced the credit quality of our tenant base, which is now the strongest we've seen. As a result, we expect revenues deemed uncollectable of 75 to 100 basis points of total revenues. In terms of cadence, we expect base rent growth to accelerate throughout the year as we commence the significant rent embedded in the SNO pipeline. Our FFO guidance reflects the strength of our same property NOI trajectory. For 2026, we are introducing NAREIT FFO guidance of $2.33-$2.37 per share, representing 4.4% growth at the midpoint, even while absorbing a $0.03 headwind from lower lease termination income as we return to historical levels and a $0.03 headwind from higher interest expense. We also expect net expense reimbursements will contribute to growth as we expect average built occupancy to increase over last year. we also expect net expense reimbursements will contribute to growth as we expect average built occupancy to increase over last year Our continued transformation across the portfolio has meaningfully enhanced the credit quality of our tenant base, which is now the strongest we've seen. our continued transformation across the portfolio has meaningfully enhanced the credit quality of our tenant base which is now the strongest we've seen As a result, we expect revenues deemed uncollectable of 75 to 100 basis points of total revenues. as a result we expect revenues deemed uncollectable of 75 to 100 basis points of total revenues In terms of cadence, we expect base rent growth to accelerate throughout the year as we commence the significant rent embedded in the SNO pipeline. in terms of cadence we expect base rent growth to accelerate throughout the year as we commence the significant rent embedded in the sno pipeline Our FFO guidance reflects the strength of our same property NOI trajectory. our ffo guidance reflects the strength of our same property noi trajectory For 2026, we are introducing NAREIT FFO guidance of $2.33-$2.37 per share, representing 4.4% growth at the midpoint, even while absorbing a $0.03 headwind from lower lease termination income as we return to historical levels and a $0.03 headwind from higher interest expense. for 2026 we are introducing nareit ffo guidance of $2.33-$2.37 per share representing 4.4% growth at the midpoint even while absorbing a $0.03 headwind from lower lease termination income as we return to historical levels and a $0.03 headwind from higher interest expense Capital deployment across the portfolio remains highly efficient, with leasing and maintenance capital expenditures down approximately $26 million year-over-year. Strong competition for space continues to push net effective rents to a record $23.66, and our payback period now averages two years, the most attractive levels we've seen in nearly a decade. We have steadily reduced maintenance capital expenditures over several years while enhancing the overall quality and appearance of our centers. We ended the period with $1.6 billion of available liquidity, including $360 million in cash raised in our September 2025 4.85% issuance, which pre-funded our June 2026 $600 million 4.125% maturity. Debt to EBITDA is 5.4 times, leaving our balance sheet well-positioned to support our business plan. Capital deployment across the portfolio remains highly efficient, with leasing and maintenance capital expenditures down approximately $26 million year-over-year. capital deployment across the portfolio remains highly efficient with leasing and maintenance capital expenditures down approximately $26 million year-over-year Strong competition for space continues to push net effective rents to a record $23.66, and our payback period now averages two years, the most attractive levels we've seen in nearly a decade. strong competition for space continues to push net effective rents to a record $23.66 and our payback period now averages two years the most attractive levels we've seen in nearly a decade We have steadily reduced maintenance capital expenditures over several years while enhancing the overall quality and appearance of our centers. we have steadily reduced maintenance capital expenditures over several years while enhancing the overall quality and appearance of our centers We ended the period with $1.6 billion of available liquidity, including $360 million in cash raised in our September 2025 4.85% issuance, which pre-funded our June 2026 $600 million 4.125% maturity. we ended the period with $1.6 billion of available liquidity including $360 million in cash raised in our september 2025 4.85% issuance which pre-funded our june 2026 $600 million 4.125% maturity Debt to EBITDA is 5.4 times, leaving our balance sheet well-positioned to support our business plan. debt to ebitda is 5.4 times leaving our balance sheet well-positioned to support our business plan Our performance continues to highlight the durability of our fundamentals and the attractiveness of our strategy, supported by FFO growth of 4%+ since 2022, a 4.4% dividend yield, and a dividend growing at a 6% CAGR over that same period. I want to thank our team for their ongoing dedication and execution, which remains a key driver of our performance. With that, I'll turn the call over to the operator for Q&A. Our performance continues to highlight the durability of our fundamentals and the attractiveness of our strategy, supported by FFO growth of 4%+ since 2022, a 4.4% dividend yield, and a dividend growing at a 6% CAGR over that same period. our performance continues to highlight the durability of our fundamentals and the attractiveness of our strategy supported by ffo growth of 4%+ since 2022 a 4.4% dividend yield and a dividend growing at a 6% cagr over that same period I want to thank our team for their ongoing dedication and execution, which remains a key driver of our performance. i want to thank our team for their ongoing dedication and execution which remains a key driver of our performance With that, I'll turn the call over to the operator for Q&A. with that i'll turn the call over to the operator for q&a

Speaker 13: Thank you. We will now be conducting a question-and-answer session. We ask that all callers limit themselves to one question. If you have additional questions, you may re-queue, and those will be addressed time permitting. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we pull for questions. Thank you. Our first question comes from a line of Michael Goldsmith with UBS. Please proceed with your question. Thank you. thank you We will now be conducting a question-and-answer session. we will now be conducting a question-and-answer session We ask that all callers limit themselves to one question. we ask that all callers limit themselves to one question If you have additional questions, you may re-queue, and those will be addressed time permitting. if you have additional questions you may re-queue and those will be addressed time permitting If you would like to ask a question, please press star one on your telephone keypad. if you would like to ask a question please press star one on your telephone keypad A confirmation tone will indicate your line is in the question queue. a confirmation tone will indicate your line is in the question queue You may press star two if you would like to remove your question from the queue. you may press star two if you would like to remove your question from the queue For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. for participants using speaker equipment it may be necessary to pick up your handset before pressing the star keys One moment, please, while we pull for questions. one moment please while we pull for questions Thank you. thank you Our first question comes from a line of Michael Goldsmith with UBS. our first question comes from a line of michael goldsmith with ubs Please proceed with your question. please proceed with your question

Speaker 10: Good morning. Thanks a lot for taking my question. Your guidance for bad debt this year, 75-100 basis points. I guess as you entered last year, you guided to 75-110 basis points. I think you called out an upgraded portfolio quality or upgraded tenants. But I guess to try to, can you provide a little bit more detail there? And how much does this new guidance range reflect just line of sight into tenant bankruptcies? Thanks. Good morning. good morning Thanks a lot for taking my question. thanks a lot for taking my question Your guidance for bad debt this year, 75-100 basis points. your guidance for bad debt this year 75-100 basis points I guess as you entered last year, you guided to 75-110 basis points. i guess as you entered last year you guided to 75-110 basis points I think you called out an upgraded portfolio quality or upgraded tenants. i think you called out an upgraded portfolio quality or upgraded tenants But I guess to try to, can you provide a little bit more detail there? but i guess to try to can you provide a little bit more detail there and And how much does this new guidance range reflect just line of sight into tenant bankruptcies? and how much does this new guidance range reflect just line of sight into tenant bankruptcies Thanks. thanks

Speaker 1: Yeah. Michael, thanks for the question. And I'll start and let Steve take it. As both of us touched on, we're really encouraged by the tenant health trends in the portfolio. And when we sat here a year ago, we said that on the other side of these recaptures, you would see improvement in what was already the strongest underlying tenancy that we had. So if you think about our low drugstore exposure, if you look at our low theater exposure, the quality and strengths of our small shop tenancy as I mentioned, 70% of our small shops are for multi-tenant operators. All the work that we've done to the portfolio has just allowed us to attract a much stronger tenancy. Yeah. yeah Michael, thanks for the question. michael thanks for the question And I'll start and let Steve take it. and i'll start and let steve take it As both of us touched on, we're really encouraged by the tenant health trends in the portfolio. as both of us touched on we're really encouraged by the tenant health trends in the portfolio And when we sat here a year ago, we said that on the other side of these recaptures, you would see improvement in what was already the strongest underlying tenancy that we had. and when we sat here a year ago we said that on the other side of these recaptures you would see improvement in what was already the strongest underlying tenancy that we had So if you think about our low drugstore exposure, if you look at our low theater exposure, the quality and strengths of our small shop tenancy as I mentioned, 70% of our small shop s are for multi-tenant operators. so if you think about our low drugstore exposure if you look at our low theater exposure the quality and strengths of our small shop tenancy as i mentioned 70% of our small shop s are for multi-tenant operators All the work that we've done to the portfolio has just allowed us to attract a much stronger tenancy. all the work that we've done to the portfolio has just allowed us to attract a much stronger tenancy So that's reflected in terms of the guidance going forward and how we're thinking about our expectations for bad debt. Steve, you want to touch on more? So that's reflected in terms of the guidance going forward and how we're thinking about our expectations for bad debt. so that's reflected in terms of the guidance going forward and how we're thinking about our expectations for bad debt Steve, you want to touch on more? steve you want to touch on more

Speaker 17: Yeah. I mean, I think Brian hit on the macro trends. Just when you look at that guide rate, our previous historical run rate was 75-110. So it's really bringing in that top end down 10% or 10 basis points. And I think importantly, as we went through the budgeting process space by space, as we always have done, there's not a lot of disruption in the future that we're seeing. So we feel really comfortable where we are within our guidance range. Yeah. yeah I mean, I think Brian hit on the macro trends. i mean i think brian hit on the macro trends Just when you look at that guide rate, our previous historical run rate was 75-110. just when you look at that guide rate our previous historical run rate was 75-110 So it's really bringing in that top end down 10% or 10 basis points. so it's really bringing in that top end down 10% or 10 basis points And I think importantly, as we went through the budgeting process space by space, as we always have done, there's not a lot of disruption in the future that we're seeing. and i think importantly as we went through the budgeting process space by space as we always have done there's not a lot of disruption in the future that we're seeing So we feel really comfortable where we are within our guidance range. so we feel really comfortable where we are within our guidance range

Speaker 10: Thank you very much. Good luck in 2026. Thank you very much. thank you very much Good luck in 2026. good luck in 2026

Speaker 1: Thanks, Michael. We appreciate it. Thanks, Michael. thanks michael We appreciate it. we appreciate it

Speaker 13: Our next question comes from a line of Todd Thomas with KeyBanc. Please proceed with your question. Our next question comes from a line of Todd Thomas with KeyBanc. our next question comes from a line of todd thomas with keybanc Please proceed with your question. please proceed with your question

Speaker 19: Hi. Thanks. Good morning. I wanted to ask about the acquisition environment and thoughts on investments and capital recycling activity going forward. Brian, you touched on this in your prepared remarks, and maybe Mark can weigh in as well. But just wanted to get your thoughts on the pipeline heading into 2026 in terms of volume and pricing. And then second part, Steve, in the guidance reconciliation, it looks like there is $0.01 of growth related to transactions. Can you just speak to that, whether that's based on 2025 activity or if there's something implied from the forecast as a result of that? Hi. hi Thanks. thanks Good morning. good morning I wanted to ask about the acquisition environment and thoughts on investments and capital recycling activity going forward. i wanted to ask about the acquisition environment and thoughts on investments and capital recycling activity going forward Brian, you touched on this in your prepared remarks, and maybe Mark can weigh in as well. brian you touched on this in your prepared remarks and maybe mark can weigh in as well But just wanted to get your thoughts on the pipeline heading into 2026 in terms of volume and pricing. but just wanted to get your thoughts on the pipeline heading into 2026 in terms of volume and pricing And then second part, Steve, in the guidance reconciliation, it looks like there is $0.01 of growth related to transactions. and then second part steve in the guidance reconciliation it looks like there is $0.01 of growth related to transactions Can you just speak to that, whether that's based on 2025 activity or if there's something implied from the forecast as a result of that? can you just speak to that whether that's based on 2025 activity or if there's something implied from the forecast as a result of that

Speaker 1: Thanks for the question, Todd. Maybe I'll touch briefly at the start. We just have been very encouraged by what we've been seeing on the transaction front. What's interesting is 40% of the volume that Mark has done since he's been here has happened in the last five quarters because in a very competitive environment, we found opportunities to put the platform to work. And that's really what you saw last year and what we expect to see going forward. But Mark, why don't you touch on more of the overall environment? Thanks for the question, Todd. thanks for the question todd Maybe I'll touch briefly at the start. maybe i'll touch briefly at the start We just have been very encouraged by what we've been seeing on the transaction front. we just have been very encouraged by what we've been seeing on the transaction front What's interesting is 40% of the volume that Mark has done since he's been here has happened in the last five quarters because in a very competitive environment, we found opportunities to put the platform to work. what's interesting is 40% of the volume that mark has done since he's been here has happened in the last five quarters because in a very competitive environment we found opportunities to put the platform to work And that's really what you saw last year and what we expect to see going forward. and that's really what you saw last year and what we expect to see going forward But Mark, why don't you touch on more of the overall environment? but mark why don't you touch on more of the overall environment

Speaker 9: Yeah. I think you're right. As far as the pipeline goes, it continues to grow. And one of the things that's really paying dividends for us is some of the direct marketing we're doing to some of the private ownership groups. So expect us, as we think about that pipeline, to remain opportunistic, as Brian highlighted in his opening remarks, as we do think external growth today is a great lever for us to drive additional value beyond the growth in our base portfolio. However, I would highlight that the first dollar of free cash flow is going to go to redevelopment given the great returns and yields we see in that part of our business. From an overall market perspective, we're certainly seeing cap rate compression across basically all asset types in open-air retail today. Yeah. yeah I think you're right. i think you're right As far as the pipeline goes, it continues to grow. as far as the pipeline goes it continues to grow And one of the things that's really paying dividends for us is some of the direct marketing we're doing to some of the private ownership groups. and one of the things that's really paying dividends for us is some of the direct marketing we're doing to some of the private ownership groups So expect us, as we think about that pipeline, to remain opportunistic, as Brian highlighted in his opening remarks, as we do think external growth today is a great lever for us to drive additional value beyond the growth in our base portfolio. so expect us as we think about that pipeline to remain opportunistic as brian highlighted in his opening remarks as we do think external growth today is a great lever for us to drive additional value beyond the growth in our base portfolio However, I would highlight that the first dollar of free cash flow is going to go to redevelopment given the great returns and yields we see in that part of our business. however i would highlight that the first dollar of free cash flow is going to go to redevelopment given the great returns and yields we see in that part of our business From an overall market perspective, we're certainly seeing cap rate compression across basically all asset types in open-air retail today. from an overall market perspective we're certainly seeing cap rate compression across basically all asset types in open-air retail today That's been driven by an increasing amount of private capital, pension fund capital being directed towards our space given the great returns that Brixmor and the REITs have been delivering in the space. A lot of that capital that's coming in is directed towards smaller grocery anchor deals and unanchored strip. That's driving cap rates in that piece of the business down into the fives for certain high-demand markets like the Southeast and California. We continue to see smaller bid lists for larger deals like a Chino that we bought last year that really have an operating nature to the business, which fits well for the Brixmor platform. That's been driven by an increasing amount of private capital, pension fund capital being directed towards our space given the great returns that Brixmor and the REITs have been delivering in the space. that's been driven by an increasing amount of private capital pension fund capital being directed towards our space given the great returns that brixmor and the reits have been delivering in the space A lot of that capital that's coming in is directed towards smaller grocery anchor deals and unanchored strip. a lot of that capital that's coming in is directed towards smaller grocery anchor deals and unanchored strip That's driving cap rates in that piece of the business down into the fives for certain high-demand markets like the Southeast and California. that's driving cap rates in that piece of the business down into the fives for certain high-demand markets like the southeast and california We continue to see smaller bid lists for larger deals like a Chino that we bought last year that really have an operating nature to the business, which fits well for the Brixmor platform. we continue to see smaller bid lists for larger deals like a chino that we bought last year that really have an operating nature to the business which fits well for the brixmor platform

Speaker 17: Yeah. And on the guidance front, I mean, that walkdown's really sort of a growth-up approach just to help people understand the components, not necessarily from a capital allocation. I think when you're just, and Mark has touched on this in previous calls. I think you'd expect it to be sort of neutral in the initial year. And then I think, importantly, the growth profile of those assets we're acquiring are going to grow more than those assets that we're selling. Yeah. yeah And on the guidance front, I mean, that walkdown's really sort of a growth-up approach just to help people understand the components, not necessarily from a capital allocation. and on the guidance front i mean that walkdown's really sort of a growth-up approach just to help people understand the components not necessarily from a capital allocation I think when you're just, and Mark has touched on this in previous calls. i think when you're just and mark has touched on this in previous calls I think you'd expect it to be sort of neutral in the initial year. i think you'd expect it to be sort of neutral in the initial year And then I think, importantly, the growth profile of those assets we're acquiring are going to grow more than those assets that we're selling. and then i think importantly the growth profile of those assets we're acquiring are going to grow more than those assets that we're selling

Speaker 19: Okay. Thank you. Okay. okay Thank you. thank you

Speaker 1: Thanks, Todd. Thanks, Todd. thanks todd

Speaker 13: Our next question comes from a line of Haendel St. Juste with Mizuho. Please proceed with your question. Our next question comes from a line of Haendel St. Juste with Mizuho. our next question comes from a line of haendel st juste with mizuho Please proceed with your question. please proceed with your question

Speaker 6: Hey, guys. Thanks for taking the question. I wanted to go back to the guide for a bit. I was hoping you could expound on some of the assumptions, particularly as it relates to the upper end of the same-property NOI guide. It seems a little conservative relative to what you put up last year. You mentioned 450 basis points of base rent growth, I think. There's a lower tenant credit risk backdrop. You have lower occupancy. So just curious if you could maybe give some more color on the pathway or what's embedded at the upper end. Thanks. Hey, guys. hey guys Thanks for taking the question. thanks for taking the question I wanted to go back to the guide for a bit. i wanted to go back to the guide for a bit I was hoping you could expound on some of the assumptions, particularly as it relates to the upper end of the same-property NOI guide. i was hoping you could expound on some of the assumptions particularly as it relates to the upper end of the same-property noi guide It seems a little conservative relative to what you put up last year. it seems a little conservative relative to what you put up last year You mentioned 450 basis points of base rent growth, I think. you mentioned 450 basis points of base rent growth i think There's a lower tenant credit risk backdrop. there's a lower tenant credit risk backdrop You have lower occupancy. you have lower occupancy So just curious if you could maybe give some more color on the pathway or what's embedded at the upper end. so just curious if you could maybe give some more color on the pathway or what's embedded at the upper end Thanks. thanks

Speaker 17: Yeah. I mean, to get to the upper end, really, I think, especially within the same property NOI, it's kind of the same as every year, right? It's the team continue and you saw it in 2025. The team continue to execute on getting that SNO pipeline executed or sorry, commenced as early as possible and then continue to backfill that pipeline as we move throughout the year. I mean, I think as far as the guide, you just look at we've talked a lot about the compounding of those rent commencements, and you're seeing that come through. But there is a small portion of 2025 income associated with some of those names that we talked about that we did recognize income in 2025 that you have to hurdle as you head into 2026. Yeah. yeah I mean, to get to the upper end, really, I think, especially within the same property NOI, it's kind of the same as every year, right? i mean to get to the upper end really i think especially within the same property noi it's kind of the same as every year right It's the team continue and you saw it in 2025. it's the team continue and you saw it in 2025 The team continue to execute on getting that SNO pipeline executed or sorry, commenced as early as possible and then continue to backfill that pipeline as we move throughout the year. the team continue to execute on getting that sno pipeline executed or sorry commenced as early as possible and then continue to backfill that pipeline as we move throughout the year I mean, I think as far as the guide, you just look at we've talked a lot about the compounding of those rent commencements, and you're seeing that come through. i mean i think as far as the guide you just look at we've talked a lot about the compounding of those rent commencements and you're seeing that come through But there is a small portion of 2025 income associated with some of those names that we talked about that we did recognize income in 2025 that you have to hurdle as you head into 2026. but there is a small portion of 2025 income associated with some of those names that we talked about that we did recognize income in 2025 that you have to hurdle as you head into 2026

Speaker 1: Yeah. I think Steve hit it, but you can really see the drivers in that walkdown. It's pretty much exactly those components in Same Property NOI. It's hitting our dates. What can we pull in potentially from 2027? How much are we continuing to drive rent growth? We feel really comfortable with the range and really pleased with how the team's been executing and feel like we're in a good spot as we head into the year. Yeah. yeah I think Steve hit it, but you can really see the drivers in that walkdown. i think steve hit it but you can really see the drivers in that walkdown It's pretty much exactly those components in Same Property NOI. it's pretty much exactly those components in same property noi It's hitting our dates. it's hitting our dates What can we pull in potentially from 2027? what can we pull in potentially from 2027 How much are we continuing to drive rent growth? how much are we continuing to drive rent growth We feel really comfortable with the range and really pleased with how the team's been executing and feel like we're in a good spot as we head into the year. we feel really comfortable with the range and really pleased with how the team's been executing and feel like we're in a good spot as we head into the year

Speaker 6: Great. Thank you. And congrats, Brian. Great. great Thank you. thank you And congrats, Brian. and congrats brian

Speaker 1: Thanks, Haendel. I appreciate it. Thanks, Haendel. thanks haendel I appreciate it. i appreciate it

Speaker 13: Our next question comes from a line of Michael Griffin with Evercore. Please proceed with your question. Our next question comes from a line of Michael Griffin with Evercore. our next question comes from a line of michael griffin with evercore Please proceed with your question. please proceed with your question

Speaker 11: Great. Thanks. Brian, I know it's been a little over a month since you've been kind of in the permanent CEO role. I realize that Brixmor has a solid history of blocking and tackling, executing on operations, kind of making the main thing the main thing. But as you kind of get into the top job, are there any things, whether it's initiatives, how you're looking at the portfolio or platform maybe differently, that you want to kind of be able to put your mark on the company as you kind of take over in the top role? Great. great Thanks. thanks Brian, I know it's been a little over a month since you've been kind of in the permanent CEO role. brian i know it's been a little over a month since you've been kind of in the permanent ceo role I realize that Brixmor has a solid history of blocking and tackling, executing on operations, kind of making the main thing the main thing. i realize that brixmor has a solid history of blocking and tackling executing on operations kind of making the main thing the main thing But as you kind of get into the top job, are there any things, whether it's initiatives, how you're looking at the portfolio or platform maybe differently, that you want to kind of be able to put your mark on the company as you kind of take over in the top role? but as you kind of get into the top job are there any things whether it's initiatives how you're looking at the portfolio or platform maybe differently that you want to kind of be able to put your mark on the company as you kind of take over in the top role

Speaker 1: Michael, it's a great question. So I'd answer in a few ways. First, our strategy of reinvesting and aggressively operating our assets is not going to change. If anything, it's accelerating from here for all the work that we've done, meaning that we still have occupancy upside. We still have the ability to drive rents. And with the quality of tenants that we've attracted, we're going to continue to improve our assets going forward. That's going to continue to be the focus. We touched on transactions a bit earlier. I'm very encouraged by what we're seeing there. We're going to remain very disciplined. We don't need acquisitions to grow. Michael, it's a great question. michael it's a great question So I'd answer in a few ways. so i'd answer in a few ways First, our strategy of reinvesting and aggressively operating our assets is not going to change. first our strategy of reinvesting and aggressively operating our assets is not going to change If anything, it's accelerating from here for all the work that we've done, meaning that we still have occupancy upside. if anything it's accelerating from here for all the work that we've done meaning that we still have occupancy upside We still have the ability to drive rents. we still have the ability to drive rents And with the quality of tenants that we've attracted, we're going to continue to improve our assets going forward. and with the quality of tenants that we've attracted we're going to continue to improve our assets going forward That's going to continue to be the focus. that's going to continue to be the focus We touched on transactions a bit earlier. we touched on transactions a bit earlier I'm very encouraged by what we're seeing there. i'm very encouraged by what we're seeing there We're going to remain very disciplined. we're going to remain very disciplined We don't need acquisitions to grow. we don't need acquisitions to grow But it has been an awesome opportunity for us with Mark partnering with our regional teams in markets that we know really well where we have an idea of how we can drive outsized value in a very competitive environment. And I think the third thing is, and I touched on it. We've always been big on technology here and focused on how we can make more data-driven decisions and really focused on that across the organization. And we've challenged leaders across the organization to really look at their business, look at ways to improve that through technology. And I mentioned a few of the early wins that we're seeing in lease abstraction, in leasing legal in terms of efficiency with our legal spend. But it has been an awesome opportunity for us with Mark partnering with our regional teams in markets that we know really well where we have an idea of how we can drive outsized value in a very competitive environment. but it has been an awesome opportunity for us with mark partnering with our regional teams in markets that we know really well where we have an idea of how we can drive outsized value in a very competitive environment And I think the third thing is, and I touched on it. and i think the third thing is and i touched on it We've always been big on technology here and focused on how we can make more data-driven decisions and really focused on that across the organization. we've always been big on technology here and focused on how we can make more data-driven decisions and really focused on that across the organization And we've challenged leaders across the organization to really look at their business, look at ways to improve that through technology. and we've challenged leaders across the organization to really look at their business look at ways to improve that through technology And I mentioned a few of the early wins that we're seeing in lease abstraction, in leasing legal in terms of efficiency with our legal spend. and i mentioned a few of the early wins that we're seeing in lease abstraction in leasing legal in terms of efficiency with our legal spend We've been doing some work around tenant health analyses in the leasing team, particularly a lot of our junior members in terms of how they're deploying AI and automation, really more AI in terms of their leasing prospecting tool. So continue to lean in there. But overall, I mean, we're in a really good position as a team. I feel really grateful for how the company has grown during the time that I and a number of us in this room have been here. It's really kind of taking that and all the work that we've done to the portfolio and really turbocharging the business plan going forward. We've been doing some work around tenant health analyses in the leasing team, particularly a lot of our junior members in terms of how they're deploying AI and automation, really more AI in terms of their leasing prospecting tool. we've been doing some work around tenant health analyses in the leasing team particularly a lot of our junior members in terms of how they're deploying ai and automation really more ai in terms of their leasing prospecting tool So continue to lean in there. so continue to lean in there But overall, I mean, we're in a really good position as a team. but overall i mean we're in a really good position as a team I feel really grateful for how the company has grown during the time that I and a number of us in this room have been here. i feel really grateful for how the company has grown during the time that i and a number of us in this room have been here It's really kind of taking that and all the work that we've done to the portfolio and really turbocharging the business plan going forward. it's really kind of taking that and all the work that we've done to the portfolio and really turbocharging the business plan going forward

Speaker 11: Great. Thanks so much. Great. great Thanks so much. thanks so much

Speaker 1: Thanks. Appreciate it, Michael. Thanks. thanks Appreciate it, Michael. appreciate it michael

Speaker 13: Our next question comes from a line of Craig Mailman with Citi. Please proceed with your question. Our next question comes from a line of Craig Mailman with Citi. our next question comes from a line of craig mailman with citi Please proceed with your question. please proceed with your question

Speaker 5: Hey. Good morning, everyone. I kind of want to hit on the SNO pipeline. And I'm going to try to frame this in a way that's not too confusing. But just as you guys have talked about being a little bit more aggressive, maybe taking back space, which is driving some lease term fees, which would imply some opportunistic moves there that maybe are more accretive than bad debt coming down. The SNO pipeline has continued to increase as the lease rate has increased. I'm just kind of curious, though, the growth profile of the composition of the SNO pipeline with the ability to intentionally kind of replace tenants, remerchandise, have lower tenant credit. Hey. hey Good morning, everyone. good morning everyone I kind of want to hit on the SNO pipeline. i kind of want to hit on the sno pipeline And I'm going to try to frame this in a way that's not too confusing. and i'm going to try to frame this in a way that's not too confusing But just as you guys have talked about being a little bit more aggressive, maybe taking back space, which is driving some lease term fees, which would imply some opportunistic moves there that maybe are more accretive than bad debt coming down. but just as you guys have talked about being a little bit more aggressive maybe taking back space which is driving some lease term fees which would imply some opportunistic moves there that maybe are more accretive than bad debt coming down The SNO pipeline has continued to increase as the lease rate has increased. the sno pipeline has continued to increase as the lease rate has increased I'm just kind of curious, though, the growth profile of the composition of the SNO pipeline with the ability to intentionally kind of replace tenants, remerchandise, have lower tenant credit. i'm just kind of curious though the growth profile of the composition of the sno pipeline with the ability to intentionally kind of replace tenants remerchandise have lower tenant credit Is the next batch of kind of additions to the SNO pipeline just more accretive to FFO and then AFFO as you guys can kind of throttle CapEx? Or am I reading too much into this? I'm just trying to get a sense of the potential to kind of inflect higher here, even on the growth, particularly as FFO drops to the AFFO line. Is the next batch of kind of additions to the SNO pipeline just more accretive to FFO and then AFFO as you guys can kind of throttle CapEx? is the next batch of kind of additions to the sno pipeline just more accretive to ffo and then affo as you guys can kind of throttle capex Or am I reading too much into this? or am i reading too much into this I'm just trying to get a sense of the potential to kind of inflect higher here, even on the growth, particularly as FFO drops to the AFFO line. i'm just trying to get a sense of the potential to kind of inflect higher here even on the growth particularly as ffo drops to the affo line

Speaker 1: Craig, it's a great question. I think I understand what you're asking. So basically, at this point, if you think about the nature of that SNO pipeline, what I say is a few things. So the highest rents that we've ever had, right? They're some of the strongest tenants that we've ever had. And as Steve touched on, we're doing it more efficiently with less CapEx because of the environment and the competition for space, because of the fact that a lot of these retailers have taken on more construction work themselves and have been much more accommodating in terms of accepting existing conditions. So yes, those factors would lead us to, again, attracting stronger tenants at higher rents and doing it more efficiently going forward. Craig, it's a great question. craig it's a great question I think I understand what you're asking. i think i understand what you're asking So basically, at this point, if you think about the nature of that SNO pipeline, what I say is a few things. so basically at this point if you think about the nature of that sno pipeline what i say is a few things So the highest rents that we've ever had, right? so the highest rents that we've ever had right They're some of the strongest tenants that we've ever had. they're some of the strongest tenants that we've ever had And as Steve touched on, we're doing it more efficiently with less CapEx because of the environment and the competition for space, because of the fact that a lot of these retailers have taken on more construction work themselves and have been much more accommodating in terms of accepting existing conditions. and as steve touched on we're doing it more efficiently with less capex because of the environment and the competition for space because of the fact that a lot of these retailers have taken on more construction work themselves and have been much more accommodating in terms of accepting existing conditions So yes, those factors would lead us to, again, attracting stronger tenants at higher rents and doing it more efficiently going forward. so yes those factors would lead us to again attracting stronger tenants at higher rents and doing it more efficiently going forward What I would say is we've already been doing that, and you can expect us to continue to do that because of the position that we've put the portfolio in and the environment that you're seeing. Our tenants are thriving in this environment. Our centers are driving a significant amount of traffic. So we feel really good about the nature of that pipeline going forward. What I would say is we've already been doing that, and you can expect us to continue to do that because of the position that we've put the portfolio in and the environment that you're seeing. what i would say is we've already been doing that and you can expect us to continue to do that because of the position that we've put the portfolio in and the environment that you're seeing Our tenants are thriving in this environment. our tenants are thriving in this environment Our centers are driving a significant amount of traffic. our centers are driving a significant amount of traffic So we feel really good about the nature of that pipeline going forward. so we feel really good about the nature of that pipeline going forward

Speaker 5: Thanks. Thanks. thanks

Speaker 1: Thanks, Craig. Thanks, Craig. thanks craig

Speaker 13: Our next question comes from a line of Juan Sanabria with BMO Capital Markets. Please proceed with your question. Our next question comes from a line of Juan Sanabria with BMO Capital Markets. our next question comes from a line of juan sanabria with bmo capital markets Please proceed with your question. please proceed with your question

Speaker 7: Hi. Good morning. Just hoping to talk a little bit about the term fees in the fourth quarter. And it looks like there's kind of a change in the pace of non-cash rents that were kind of noted in guidance or aligned that in the guidance. So hoping you can give a little bit more color on the driver of the term fees and the expectations into 2026 and what impact, if at all, that had on the non-cash revenues as we think about sharpening our model for 2026. Thanks. Hi. hi Good morning. good morning Just hoping to talk a little bit about the term fees in the fourth quarter. just hoping to talk a little bit about the term fees in the fourth quarter And it looks like there's kind of a change in the pace of non-cash rents that were kind of noted in guidance or aligned that in the guidance. and it looks like there's kind of a change in the pace of non-cash rents that were kind of noted in guidance or aligned that in the guidance So hoping you can give a little bit more color on the driver of the term fees and the expectations into 2026 and what impact, if at all, that had on the non-cash revenues as we think about sharpening our model for 2026. so hoping you can give a little bit more color on the driver of the term fees and the expectations into 2026 and what impact if at all that had on the non-cash revenues as we think about sharpening our model for 2026 Thanks. thanks

Speaker 1: Yeah. Juan, I'll let Steve hit on the non-cash. But let me just touch on term fees. If you take a step back, without term fees, the core business would have grown in line with where we grew, Same Property NOI at over 4% despite the fact that we took back 1.5 million sq ft of anchor space during the year. It would grow even more in 2026. We had a very unique opportunity in the fourth quarter in a center that we own in the East Bay area where we controlled the whole site, taking back the Kohl's and the Party City. We have tremendous optionality. We could do a retail plan today as we have LOIs for all that space. Or alternatively, there may be an opportunity for us to get the land rezoned for residential. Yeah. yeah Juan, I'll let Steve hit on the non-cash. juan i'll let steve hit on the non-cash But let me just touch on term fees. but let me just touch on term fees If you take a step back, without term fees, the core business would have grown in line with where we grew, Same Property NOI at over 4% despite the fact that we took back 1.5 million sq ft of anchor space during the year. if you take a step back without term fees the core business would have grown in line with where we grew same property noi at over 4% despite the fact that we took back 1.5 million sq ft of anchor space during the year It would grow even more in 2026. it would grow even more in 2026 We had a very unique opportunity in the fourth quarter in a center that we own in the East Bay area where we controlled the whole site, taking back the Kohl's and the Party City. we had a very unique opportunity in the fourth quarter in a center that we own in the east bay area where we controlled the whole site taking back the kohl's and the party city We have tremendous optionality. we have tremendous optionality We could do a retail plan today as we have LOIs for all that space. we could do a retail plan today as we have lois for all that space Or alternatively, there may be an opportunity for us to get the land rezoned for residential. or alternatively there may be an opportunity for us to get the land rezoned for residential Because of that timing, it was very opportunistic for us to take what is an outsized term fee. The amount of that probably wouldn't have been there if we had waited until we got the property rezoned. So the team did a fantastic job in terms of the timing of execution. In a normal course year, this portfolio has been generating, call it, $4 million-$6 million of term fees. It's a mix from tenants that have left where we've done settlements and others in an environment where there is a significant amount of demand that we can accretively backfill space. So expect us to continue to be opportunistic there. What you're seeing in that walkdown is specific to that large term fee that we took in the fourth quarter. Because of that timing, it was very opportunistic for us to take what is an outsized term fee. because of that timing it was very opportunistic for us to take what is an outsized term fee The amount of that probably wouldn't have been there if we had waited until we got the property rezoned. the amount of that probably wouldn't have been there if we had waited until we got the property rezoned So the team did a fantastic job in terms of the timing of execution. so the team did a fantastic job in terms of the timing of execution In a normal course year, this portfolio has been generating, call it, $4 million-$6 million of term fees. in a normal course year this portfolio has been generating call it $4 million-$6 million of term fees It's a mix from tenants that have left where we've done settlements and others in an environment where there is a significant amount of demand that we can accretively backfill space. it's a mix from tenants that have left where we've done settlements and others in an environment where there is a significant amount of demand that we can accretively backfill space So expect us to continue to be opportunistic there. so expect us to continue to be opportunistic there What you're seeing in that walkdown is specific to that large term fee that we took in the fourth quarter. what you're seeing in that walkdown is specific to that large term fee that we took in the fourth quarter And it was a very, very unique situation. So Steve, why don't you hit on the non-cash? And it was a very, very unique situation. and it was a very very unique situation So Steve, why don't you hit on the non-cash? so steve why don't you hit on the non-cash

Speaker 17: Yeah. The non-cash, and we talked about it on previous calls, is really acceleration of 141 associated with some of the bankruptcies that we encountered throughout the year. So that was more focused on those tenants and not something that we expect to recur going forward. Yeah. yeah The non-cash, and we talked about it on previous calls, is really acceleration of 141 associated with some of the bankruptcies that we encountered throughout the year. the non-cash and we talked about it on previous calls is really acceleration of 141 associated with some of the bankruptcies that we encountered throughout the year So that was more focused on those tenants and not something that we expect to recur going forward. so that was more focused on those tenants and not something that we expect to recur going forward

Speaker 13: Our next question comes from a line of Greg McGinnis with Scotiabank. Please proceed with your question. Our next question comes from a line of Greg McGinnis with Scotiabank. our next question comes from a line of greg mcginnis with scotiabank Please proceed with your question. please proceed with your question

Speaker 20: Hello. This is Viktor Fedun with Greg McGinnis. Thanks for taking our question. In terms of external growth, so Q4 acquisitions seem to feed that traditional grocery anchor mold. And are you seeing better risk-adjusted returns in these core grocery assets right now compared to the value-add lifestyle opportunities you discussed earlier in 2025? Hello. hello This is Viktor Fedun with Greg McGinnis. this is viktor fedun with greg mcginnis Thanks for taking our question. thanks for taking our question In terms of external growth, so Q4 acquisitions seem to feed that traditional grocery anchor mold. in terms of external growth so q4 acquisitions seem to feed that traditional grocery anchor mold And are you seeing better risk-adjusted returns in these core grocery assets right now compared to the value-add lifestyle opportunities you discussed earlier in 2025? and are you seeing better risk-adjusted returns in these core grocery assets right now compared to the value-add lifestyle opportunities you discussed earlier in 2025

Speaker 1: I'll let Mark take that. I'll let Mark take that. i'll let mark take that

Speaker 9: Yeah. I think if you look at what we've been buying over the years, our focus is actually pretty simple. We're trying to find assets within our footprint where we can really drive outsized ROIC opportunities. So if you think back to 2024, we bought an asset in Tampa called Britton Plaza, which was a classic opportunistic deal where we purchased the land very attractively. We have a big redevelopment opportunity there that we're working on getting into the pipelines quickly as we can. Moving to 2025, if you look at the range of assets we bought, we did buy Lifestyle Center in Houston. We bought a traditional grocery anchor deal in Denver. And we bought Chino at the end of the year, which is on the West Coast in L.A. Yeah. yeah I think if you look at what we've been buying over the years, our focus is actually pretty simple. i think if you look at what we've been buying over the years our focus is actually pretty simple We're trying to find assets within our footprint where we can really drive outsized ROIC opportunities. we're trying to find assets within our footprint where we can really drive outsized roic opportunities So if you think back to 2024, we bought an asset in Tampa called Britton Plaza, which was a classic opportunistic deal where we purchased the land very attractively. so if you think back to 2024 we bought an asset in tampa called britton plaza which was a classic opportunistic deal where we purchased the land very attractively We have a big redevelopment opportunity there that we're working on getting into the pipelines quickly as we can. we have a big redevelopment opportunity there that we're working on getting into the pipelines quickly as we can Moving to 2025, if you look at the range of assets we bought, we did buy Lifestyle Center in Houston. moving to 2025 if you look at the range of assets we bought we did buy lifestyle center in houston We bought a traditional grocery anchor deal in Denver. we bought a traditional grocery anchor deal in denver And we bought Chino at the end of the year, which is on the West Coast in L.A. and we bought chino at the end of the year which is on the west coast in l.a All those assets have great opportunities for the Brixmor platform to apply our platform to drive higher yields going in, drive longer-term growth. That's what we're really focused on, not necessarily the asset type. We're looking for growth that occurs in our footprint and where we can apply our platform that may be in a lifestyle center with great growth opportunities like LaCenterra. Or it could be a great redevelopment opportunity like Britton. All those assets have great opportunities for the Brixmor platform to apply our platform to drive higher yields going in, drive longer-term growth. all those assets have great opportunities for the brixmor platform to apply our platform to drive higher yields going in drive longer-term growth That's what we're really focused on, not necessarily the asset type. that's what we're really focused on not necessarily the asset type We're looking for growth that occurs in our footprint and where we can apply our platform that may be in a lifestyle center with great growth opportunities like LaCenterra. we're looking for growth that occurs in our footprint and where we can apply our platform that may be in a lifestyle center with great growth opportunities like lacenterra Or it could be a great redevelopment opportunity like Britton. or it could be a great redevelopment opportunity like britton

Speaker 20: Thank you. Thank you. thank you

Speaker 13: Our next question comes from a line of Caitlin Burrows with Goldman Sachs. Please proceed with your question. Our next question comes from a line of Caitlin Burrows with Goldman Sachs. our next question comes from a line of caitlin burrows with goldman sachs Please proceed with your question. please proceed with your question

Speaker 2: Hi, everyone. Good morning. Maybe another question on the SNO pipeline. So it's off its highs as economic occupancy has gone up, which is great. But I guess looking forward, when you consider leasing demand and the amount of vacancy that you do have, what is your view on the SNO pipeline replenishing itself kind of as we go forward? Hi, everyone. hi everyone Good morning. good morning Maybe another question on the SNO pipeline. maybe another question on the sno pipeline So it's off its highs as economic occupancy has gone up, which is great. so it's off its highs as economic occupancy has gone up which is great But I guess looking forward, when you consider leasing demand and the amount of vacancy that you do have, what is your view on the SNO pipeline replenishing itself kind of as we go forward? but i guess looking forward when you consider leasing demand and the amount of vacancy that you do have what is your view on the sno pipeline replenishing itself kind of as we go forward

Speaker 1: Yeah. Caitlin, we remain very encouraged with the demand environment. That SNO pipeline has been fairly sticky at around $60 million, even though we've been commencing anywhere from $15 million to $20 million-$22 million a quarter because we've been replenishing it. So the conversations we're having with retailers, retailers that are thriving and continuing to drive traffic to their stores, they're looking to open store count in an environment where there's not a lot of space. So we feel pretty confident in terms of our ability to continue to replenish that. I mentioned occupancy upside. We're still 50 basis points below the prior peak from a leased occupancy perspective. And that was by no means a cap on the portfolio because the portfolio is in a much better position today. Yeah. yeah Caitlin, we remain very encouraged with the demand environment. caitlin we remain very encouraged with the demand environment That SNO pipeline has been fairly sticky at around $60 million, even though we've been commencing anywhere from $15 million to $20 million-$22 million a quarter because we've been replenishing it. that sno pipeline has been fairly sticky at around $60 million even though we've been commencing anywhere from $15 million to $20 million-$22 million a quarter because we've been replenishing it So the conversations we're having with retailers, retailers that are thriving and continuing to drive traffic to their stores, they're looking to open store count in an environment where there's not a lot of space. so the conversations we're having with retailers retailers that are thriving and continuing to drive traffic to their stores they're looking to open store count in an environment where there's not a lot of space So we feel pretty confident in terms of our ability to continue to replenish that. so we feel pretty confident in terms of our ability to continue to replenish that I mentioned occupancy upside. i mentioned occupancy upside We're still 50 basis points below the prior peak from a leased occupancy perspective. we're still 50 basis points below the prior peak from a leased occupancy perspective And that was by no means a cap on the portfolio because the portfolio is in a much better position today. and that was by no means a cap on the portfolio because the portfolio is in a much better position today Really feel very encouraged about what we're seeing from an overall demand environment as we move into the year to replenish the pipeline. Really feel very encouraged about what we're seeing from an overall demand environment as we move into the year to replenish the pipeline. really feel very encouraged about what we're seeing from an overall demand environment as we move into the year to replenish the pipeline

Speaker 13: Our next question comes from a line of Samir Khanal with Bank of America. Please proceed with your question. Our next question comes from a line of Samir Khanal with Bank of America. our next question comes from a line of samir khanal with bank of america Please proceed with your question. please proceed with your question

Speaker 15: Yeah. Good morning, everybody. I guess, Steve, just curious on the other revenue ancillary income component. I guess what's assumed as part of guidance this year? I know last quarter, you talked about the parking agreement. That benefited some of this quarter. How should we think about that sort of line item of other revenue as we think about 2026? Thanks. Yeah. yeah Good morning, everybody. good morning everybody I guess, Steve, just curious on the other revenue ancillary income component. i guess steve just curious on the other revenue ancillary income component I guess what's assumed as part of guidance this year? i guess what's assumed as part of guidance this year I know last quarter, you talked about the parking agreement. i know last quarter you talked about the parking agreement That benefited some of this quarter. that benefited some of this quarter How should we think about that sort of line item of other revenue as we think about 2026? how should we think about that sort of line item of other revenue as we think about 2026 Thanks. thanks

Speaker 17: Yeah. I think the things we were trying to highlight in the script is really the focus of the entire organization and maximizing revenue across our properties. We have a very, very strong ancillary team in-house that this is their main focus is driving that type of income. So one example of that was the Pointe Orlando garage, which is a recurring item. I tried to break that out a little separately so you all could see that contribution from that. But in that other bucket, you still see even though some of those were some of that revenue was more focused on the boxes we got back in the year, there are always those opportunities across the portfolio. So it's not a line item we necessarily give guidance on. Yeah. yeah I think the things we were trying to highlight in the script is really the focus of the entire organization and maximizing revenue across our properties. i think the things we were trying to highlight in the script is really the focus of the entire organization and maximizing revenue across our properties We have a very, very strong ancillary team in-house that this is their main focus is driving that type of income. we have a very very strong ancillary team in-house that this is their main focus is driving that type of income So one example of that was the Pointe Orlando garage, which is a recurring item. so one example of that was the pointe orlando garage which is a recurring item I tried to break that out a little separately so you all could see that contribution from that. i tried to break that out a little separately so you all could see that contribution from that But in that other bucket, you still see even though some of those were some of that revenue was more focused on the boxes we got back in the year, there are always those opportunities across the portfolio. but in that other bucket you still see even though some of those were some of that revenue was more focused on the boxes we got back in the year there are always those opportunities across the portfolio So it's not a line item we necessarily give guidance on. so it's not a line item we necessarily give guidance on I don't think it'll meaningfully move the range one way or the other as we continue to just find additional opportunities across the portfolio to maximize income. I don't think it'll meaningfully move the range one way or the other as we continue to just find additional opportunities across the portfolio to maximize income. i don't think it'll meaningfully move the range one way or the other as we continue to just find additional opportunities across the portfolio to maximize income

Speaker 1: And, Samir, I would just add Steve hit on it. But this is a team of operators. And so as we look to create value in our assets and mine income opportunities to drive revenue, we're seeing higher rents in terms of electric car charging stations. We're seeing higher rents in terms of our solar. We're seeing very interesting uses in terms of that temp inline space. So from that perspective, the specialty team's done a great job. And as part of the realignment a few years ago, we partnered that more with the operating platform. So there's a lot of collaboration with our property management teams, with our leasing teams in the region. They're working side by side. And so you really saw that come through. And, Samir, I would just add Steve hit on it. and samir i would just add steve hit on it But this is a team of operators. but this is a team of operators And so as we look to create value in our assets and mine income opportunities to drive revenue, we're seeing higher rents in terms of electric car charging stations. and so as we look to create value in our assets and mine income opportunities to drive revenue we're seeing higher rents in terms of electric car charging stations We're seeing higher rents in terms of our solar. we're seeing higher rents in terms of our solar We're seeing very interesting uses in terms of that temp inline space. we're seeing very interesting uses in terms of that temp inline space So from that perspective, the specialty team's done a great job. so from that perspective the specialty team's done a great job And as part of the realignment a few years ago, we partnered that more with the operating platform. and as part of the realignment a few years ago we partnered that more with the operating platform So there's a lot of collaboration with our property management teams, with our leasing teams in the region. so there's a lot of collaboration with our property management teams with our leasing teams in the region They're working side by side. they're working side by side And so you really saw that come through. and so you really saw that come through Steve did point out some large one-time items, not really one-time, but larger items that contributed. But the nature of that is going to be recurring. So we feel really good about the trends in the specialty business going forward, but more importantly, how our team's working together to drive value. Steve did point out some large one-time items, not really one-time, but larger items that contributed. steve did point out some large one-time items not really one-time but larger items that contributed But the nature of that is going to be recurring. but the nature of that is going to be recurring So we feel really good about the trends in the specialty business going forward, but more importantly, how our team's working together to drive value. so we feel really good about the trends in the specialty business going forward but more importantly how our team's working together to drive value

Speaker 13: Our next question comes from a line of Cooper Clark with Wells Fargo. Please proceed with your question. Our next question comes from a line of Cooper Clark with Wells Fargo. our next question comes from a line of cooper clark with wells fargo Please proceed with your question. please proceed with your question

Speaker 4: Great. Thanks for taking the question. I know we touched on the acquisition side earlier. So curious if you could comment on the disposition pipeline as it stands today in terms of volumes and how we should think about the disposition cadence throughout the year given some of the strength in market pricing and opportunity to reinvest accretively with your redevelopment pipeline. Also curious on the depth of bidder pools and what buyers you're seeing most aggressively pursue deals. Great. great Thanks for taking the question. thanks for taking the question I know we touched on the acquisition side earlier. i know we touched on the acquisition side earlier So curious if you could comment on the disposition pipeline as it stands today in terms of volumes and how we should think about the disposition cadence throughout the year given some of the strength in market pricing and opportunity to reinvest accretively with your redevelopment pipeline. so curious if you could comment on the disposition pipeline as it stands today in terms of volumes and how we should think about the disposition cadence throughout the year given some of the strength in market pricing and opportunity to reinvest accretively with your redevelopment pipeline Also curious on the depth of bidder pools and what buyers you're seeing most aggressively pursue deals. also curious on the depth of bidder pools and what buyers you're seeing most aggressively pursue deals

Speaker 9: Yeah. Sure. For the dispos, what's really interesting about the dispo market is really the demand that we're seeing in the market today. So last year, the dispos we sold were blending to a low 7 cap rate. The market's really allowing us to exit assets at better-than-expected cap rates for assets where we see lower growth and would really be near the bottom of our portfolio in terms of value creation from our perspective. What's important from our perspective is that we remain very confident in our ability to sell these lower-growth assets and recycle that capital into higher-growth opportunities like a Chino, like a Broomfield, where we're really seeing dispos underwrite. We think the buyers are underwriting IRRs in that mid-7% to 8% range. Yeah. yeah Sure. sure For the dispos, what's really interesting about the dispo market is really the demand that we're seeing in the market today. for the dispos what's really interesting about the dispo market is really the demand that we're seeing in the market today So last year, the dispos we sold were blending to a low 7 cap rate. so last year the dispos we sold were blending to a low 7 cap rate The market's really allowing us to exit assets at better-than-expected cap rates for assets where we see lower growth and would really be near the bottom of our portfolio in terms of value creation from our perspective. the market's really allowing us to exit assets at better-than-expected cap rates for assets where we see lower growth and would really be near the bottom of our portfolio in terms of value creation from our perspective What's important from our perspective is that we remain very confident in our ability to sell these lower-growth assets and recycle that capital into higher-growth opportunities like a Chino, like a Broomfield, where we're really seeing dispos underwrite. what's important from our perspective is that we remain very confident in our ability to sell these lower-growth assets and recycle that capital into higher-growth opportunities like a chino like a broomfield where we're really seeing dispos underwrite We think the buyers are underwriting IRRs in that mid-7% to 8% range. we think the buyers are underwriting irrs in that mid-7% to 8% range And we're really buying assets from our perspective with IRRs that are generally blending in that high 9%-10% range. So we remain really convicted in that part of the trade we're making. As far as bid lists, it's really dependent on size. So one of the things you've seen is a lot of money raised to try to buy open-air grocery anchored centers. I think a lot of that capital was focused on one quality of assets. They've seen cap rate compressed. And they've had to go after a slightly lower demographic, a slightly lower gross performance. And that's really allowing us to drive cap rate on what we're selling at the bottom part of our portfolio. In terms of who those are, it's pension funds. It's high net worth. You're seeing local groups come back out of the woodwork. And we're really buying assets from our perspective with IRRs that are generally blending in that high 9%-10% range. and we're really buying assets from our perspective with irrs that are generally blending in that high 9%-10% range So we remain really convicted in that part of the trade we're making. so we remain really convicted in that part of the trade we're making As far as bid lists, it's really dependent on size. as far as bid lists it's really dependent on size So one of the things you've seen is a lot of money raised to try to buy open-air grocery anchored centers. so one of the things you've seen is a lot of money raised to try to buy open-air grocery anchored centers I think a lot of that capital was focused on one quality of assets. i think a lot of that capital was focused on one quality of assets They've seen cap rate compressed. they've seen cap rate compressed And they've had to go after a slightly lower demographic, a slightly lower gross performance. and they've had to go after a slightly lower demographic a slightly lower gross performance And that's really allowing us to drive cap rate on what we're selling at the bottom part of our portfolio. and that's really allowing us to drive cap rate on what we're selling at the bottom part of our portfolio In terms of who those are, it's pension funds. in terms of who those are it's pension funds It's high net worth. it's high net worth You're seeing local groups come back out of the woodwork. you're seeing local groups come back out of the woodwork So it's a really healthy market today. As I mentioned earlier, the biggest difference is really size. So when you're selling a $5 million asset, the bid pool's very large. When you get up to a Chino, which was $140 million or $138 million, that bid list was actually quite small and really allowed us to find a great opportunity to drive higher IRRs given the demand there. So we remain really convicted about our ability to sell, again, lower IRR and buy higher IRR. We're really excited about that opportunity. So it's a really healthy market today. so it's a really healthy market today As I mentioned earlier, the biggest difference is really size. as i mentioned earlier the biggest difference is really size So when you're selling a $5 million asset, the bid pool's very large. so when you're selling a $5 million asset the bid pool's very large When you get up to a Chino, which was $140 million or $138 million, that bid list was actually quite small and really allowed us to find a great opportunity to drive higher IRRs given the demand there. when you get up to a chino which was $140 million or $138 million that bid list was actually quite small and really allowed us to find a great opportunity to drive higher irrs given the demand there So we remain really convicted about our ability to sell, again, lower IRR and buy higher IRR. so we remain really convicted about our ability to sell again lower irr and buy higher irr We're really excited about that opportunity. we're really excited about that opportunity

Speaker 13: Our next question comes from a line of Connor Mitchell with Piper Sandler. Please proceed with your question. Our next question comes from a line of Connor Mitchell with Piper Sandler. our next question comes from a line of connor mitchell with piper sandler Please proceed with your question. please proceed with your question

Speaker 3: Hey. Thanks for taking my question. Just going back to the bad debt outlook for this year and just kind of thinking about the watchlist, you mentioned that you've had limited exposure to pharmacies or theaters. But just wondering if you could kind of put some context around the general watchlist and what you're seeing within your portfolio, whether that's maybe a majority of the watchlist or higher up on the watchlist are kind of one-off situations where there's upcoming debt maturities and it's more of a balance sheet issue, and that's the worry, or if more of those tenants, retailers are kind of more within a theme or a service type kind of group together. Hey. hey Thanks for taking my question. thanks for taking my question Just going back to the bad debt outlook for this year and just kind of thinking about the watchlist, you mentioned that you've had limited exposure to pharmacies or theaters. just going back to the bad debt outlook for this year and just kind of thinking about the watchlist you mentioned that you've had limited exposure to pharmacies or theaters But just wondering if you could kind of put some context around the general watchlist and what you're seeing within your portfolio, whether that's maybe a majority of the watchlist or higher up on the watchlist are kind of one-off situations where there's upcoming debt maturities and it's more of a balance sheet issue, and that's the worry, or if more of those tenants, retailers are kind of more within a theme or a service type kind of group together. but just wondering if you could kind of put some context around the general watchlist and what you're seeing within your portfolio whether that's maybe a majority of the watchlist or higher up on the watchlist are kind of one-off situations where there's upcoming debt maturities and it's more of a balance sheet issue and that's the worry or if more of those tenants retailers are kind of more within a theme or a service type kind of group together

Speaker 1: Yeah. Connor, it's a good question. And it's something that we are always watching. This team historically has been very proactive in terms of addressing things ahead of potential credit events. Many of you on the call today have screened watchlists across our peer set. And if you look at where ours is today, we screen very favorably in terms of those categories that I mentioned. The other thing that we feel very confident about is a few years ago, we put very stringent underwriting standards in place, the most stringent the company's ever had with our finance team and our leasing teams in terms of underwriting small shop tenancy. And what we saw there was who was taking space was multi-unit operators established that had much stronger credit profiles than we had seen historically. Yeah. yeah Connor, it's a good question. connor it's a good question And it's something that we are always watching. and it's something that we are always watching This team historically has been very proactive in terms of addressing things ahead of potential credit events. this team historically has been very proactive in terms of addressing things ahead of potential credit events Many of you on the call today have screened watchlists across our peer set. many of you on the call today have screened watchlists across our peer set And if you look at where ours is today, we screen very favorably in terms of those categories that I mentioned. and if you look at where ours is today we screen very favorably in terms of those categories that i mentioned The other thing that we feel very confident about is a few years ago, we put very stringent underwriting standards in place, the most stringent the company's ever had with our finance team and our leasing teams in terms of underwriting small shop tenancy. the other thing that we feel very confident about is a few years ago we put very stringent underwriting standards in place the most stringent the company's ever had with our finance team and our leasing teams in terms of underwriting small shop tenancy And what we saw there was who was taking space was multi-unit operators established that had much stronger credit profiles than we had seen historically. and what we saw there was who was taking space was multi-unit operators established that had much stronger credit profiles than we had seen historically It's why we have so many multi-unit operators in that space. So we still have a tenant health call with our team. Steve and I review it on a monthly basis. Our teams are reviewing it daily. And the trends we see are very positive. We're not seeing an uptick in delinquencies. We're not seeing an uptick in move-outs, normal course move-outs for the portfolio last year if you take away the bankruptcies. We're again at historic lows for the portfolio, retention rates up, renewal growth in the mid-teens. So I think all those trends give you visibility into the health of the portfolio. There's always a handful of names that we're watching. It just tends to be very low for us at this point. It's why we have so many multi-unit operators in that space. it's why we have so many multi-unit operators in that space So we still have a tenant health call with our team. so we still have a tenant health call with our team Steve and I review it on a monthly basis. steve and i review it on a monthly basis Our teams are reviewing it daily. our teams are reviewing it daily And the trends we see are very positive. and the trends we see are very positive We're not seeing an uptick in delinquencies. we're not seeing an uptick in delinquencies We're not seeing an uptick in move-outs, normal course move-outs for the portfolio last year if you take away the bankruptcies. we're not seeing an uptick in move-outs normal course move-outs for the portfolio last year if you take away the bankruptcies We're again at historic lows for the portfolio, retention rates up, renewal growth in the mid-teens. we're again at historic lows for the portfolio retention rates up renewal growth in the mid-teens So I think all those trends give you visibility into the health of the portfolio. so i think all those trends give you visibility into the health of the portfolio There's always a handful of names that we're watching. there's always a handful of names that we're watching It just tends to be very low for us at this point. it just tends to be very low for us at this point

Speaker 13: Our next question comes from a line of Michael Mueller with JPMorgan. Please proceed with your question. Our next question comes from a line of Michael Mueller with JP Morgan. our next question comes from a line of michael mueller with jp morgan Please proceed with your question. please proceed with your question

Speaker 12: Yeah. Hi. Can you talk a little bit more about, I guess, using tech and AI to evaluate tenant health? And has it changed your watchlist in any material way as a result of the approach? Yeah. yeah Hi. hi Can you talk a little bit more about, I guess, using tech and AI to evaluate tenant health? can you talk a little bit more about i guess using tech and ai to evaluate tenant health And has it changed your watchlist in any material way as a result of the approach? and has it changed your watchlist in any material way as a result of the approach

Speaker 1: Yeah. One of the things we're looking at, Mike, it's a great question, is not, I mean, you all on the phone have the names you may be watching or the categories that I mentioned. But it's really those where can we start to get some early signals, right, that's not just, "Hey, well, the tenant got a default this month," or, "The tenant was a little bit late." Can we start to see where that payment date goes from the third date to the fifth date? It's things like that relative that we've started to roll out. We're seeing some pretty interesting trends. And we can at least start to have a conversation with people ahead of time. Yeah. yeah One of the things we're looking at, Mike, it's a great question, is not, I mean, you all on the phone have the names you may be watching or the categories that I mentioned. one of the things we're looking at mike it's a great question is not i mean you all on the phone have the names you may be watching or the categories that i mentioned But it's really those where can we start to get some early signals, right, that's not just, "Hey, well, the tenant got a default this month," or, "The tenant was a little bit late." Can we start to see where that payment date goes from the third date to the fifth date? but it's really those where can we start to get some early signals right that's not just "hey well the tenant got a default this month," or "the tenant was a little bit late." can we start to see where that payment date goes from the third date to the fifth date It's things like that relative that we've started to roll out. it's things like that relative that we've started to roll out We're seeing some pretty interesting trends. we're seeing some pretty interesting trends And we can at least start to have a conversation with people ahead of time. and we can at least start to have a conversation with people ahead of time I think that's just one example of how we're using all the data that we have across the entire platform to just make more data-informed, data-driven decisions.So it's something that was a big focus of ours as part of the realignment to get consistency in the types of dashboards that we're using to measure our tasks and to measure our improvement in certain operating metrics as we go throughout the year. So that's just one aspect of it. And I think as we continue to deploy things throughout the year, we'll continue to share some of the benefits. But I'm really pleased at how the team has adopted this mindset and how we're pushing things forward really across the platform. I think that's just one example of how we're using all the data that we have across the entire platform to just make more data-informed, data-driven decisions. i think that's just one example of how we're using all the data that we have across the entire platform to just make more data-informed data-driven decisions So it's something that was a big focus of ours as part of the realignment to get consistency in the types of dashboards that we're using to measure our tasks and to measure our improvement in certain operating metrics as we go throughout the year. so it's something that was a big focus of ours as part of the realignment to get consistency in the types of dashboards that we're using to measure our tasks and to measure our improvement in certain operating metrics as we go throughout the year So that's just one aspect of it. so that's just one aspect of it And I think as we continue to deploy things throughout the year, we'll continue to share some of the benefits. and i think as we continue to deploy things throughout the year we'll continue to share some of the benefits But I'm really pleased at how the team has adopted this mindset and how we're pushing things forward really across the platform. but i'm really pleased at how the team has adopted this mindset and how we're pushing things forward really across the platform

Speaker 13: As a reminder, if you would like to ask a question, press star one on your telephone keypad. Our next question comes from a line of Linda Tsai with Jefferies. Please proceed with your question. As a reminder, if you would like to ask a question, press star one on your telephone keypad. as a reminder if you would like to ask a question press star one on your telephone keypad Our next question comes from a line of Linda Tsai with Jefferies. our next question comes from a line of linda tsai with jefferies Please proceed with your question. please proceed with your question

Speaker 8: Thanks for taking my question. The improved retention rate of 87%, I guess that helps support the record low CapEx down 14% year-over-year. How sustainable do you view lower CapEx spend if you had to look out a few years? Thanks for taking my question. thanks for taking my question The improved retention rate of 87%, I guess that helps support the record low CapEx down 14% year-over-year. the improved retention rate of 87% i guess that helps support the record low capex down 14% year-over-year How sustainable do you view lower CapEx spend if you had to look out a few years? how sustainable do you view lower capex spend if you had to look out a few years

Speaker 1: We certainly see it at this run rate, Linda. It's a great question in terms of where we are. So I kind of break it down a few ways. We still plan. We think it's a great use of capital for accretive reinvestment. I think where we have seen the declines is on the leasing side where competition for space and improvement in the portfolio has allowed us to reduce CapEx in those deals while still growing rents significantly. I also think, again, retailers, and you're seeing it. You saw it last year in the auctions, have been much more willing to take on existing space and much more flexible in terms of those buildouts. So that's driving it as well. The deferred maintenance overhang of this portfolio is behind us from a maintenance CapEx perspective. We certainly see it at this run rate, Linda. we certainly see it at this run rate linda It's a great question in terms of where we are. it's a great question in terms of where we are So I kind of break it down a few ways. so i kind of break it down a few ways We still plan. we still plan We think it's a great use of capital for accretive reinvestment. we think it's a great use of capital for accretive reinvestment I think where we have seen the declines is on the leasing side where competition for space and improvement in the portfolio has allowed us to reduce CapEx in those deals while still growing rents significantly. i think where we have seen the declines is on the leasing side where competition for space and improvement in the portfolio has allowed us to reduce capex in those deals while still growing rents significantly I also think, again, retailers, and you're seeing it. i also think again retailers and you're seeing it You saw it last year in the auctions, have been much more willing to take on existing space and much more flexible in terms of those buildouts. you saw it last year in the auctions have been much more willing to take on existing space and much more flexible in terms of those buildouts So that's driving it as well. so that's driving it as well The deferred maintenance overhang of this portfolio is behind us from a maintenance CapEx perspective. the deferred maintenance overhang of this portfolio is behind us from a maintenance capex perspective This is now 3 years running of maintenance CapEx lowest for the portfolio, the lowest since 2016 outside of the pandemic year. We have been very intentional. You're thinking now it's more roofs and parking lots. But even within that, the fact that we're doing portfolio-wide roofing bids, the fact that our property managers are working with our redevelopment teams in terms of some of the things that we may need to improve in those reinvestments to avoid future CapEx going forward, and then you just look about it and then you look at it on the expense side as well from a recovery rate, all the work that we've done in cleaning up our CAM clauses has allowed us to get paid back for the operating expense investment that we've been making in our assets. This is now 3 years running of maintenance CapEx lowest for the portfolio, the lowest since 2016 outside of the pandemic year. this is now 3 years running of maintenance capex lowest for the portfolio the lowest since 2016 outside of the pandemic year We have been very intentional. we have been very intentional You're thinking now it's more roofs and parking lots. you're thinking now it's more roofs and parking lots But even within that, the fact that we're doing portfolio-wide roofing bids, the fact that our property managers are working with our redevelopment teams in terms of some of the things that we may need to improve in those reinvestments to avoid future CapEx going forward, and then you just look about it and then you look at it on the expense side as well from a recovery rate, all the work that we've done in cleaning up our CAM clauses has allowed us to get paid back for the operating expense investment that we've been making in our assets. but even within that the fact that we're doing portfolio-wide roofing bids the fact that our property managers are working with our redevelopment teams in terms of some of the things that we may need to improve in those reinvestments to avoid future capex going forward and then you just look about it and then you look at it on the expense side as well from a recovery rate all the work that we've done in cleaning up our cam clauses has allowed us to get paid back for the operating expense investment that we've been making in our assets You put that all together, in addition to the environment, it's leading to lower CapEx. We feel like we're in a good position right now as we go forward. You put that all together, in addition to the environment, it's leading to lower CapEx. you put that all together in addition to the environment it's leading to lower capex We feel like we're in a good position right now as we go forward. we feel like we're in a good position right now as we go forward

Speaker 8: Thanks for the color. Good luck. Thanks for the color. thanks for the color Good luck. good luck

Speaker 1: Thanks, Linda. Appreciate it. Thanks, Linda. thanks linda Appreciate it. appreciate it

Speaker 13: Our next question comes from a line of Paulina Rojas with Green Street. Please proceed with your question. Our next question comes from a line of Paulina Rojas with Green Street. our next question comes from a line of paulina rojas with green street Please proceed with your question. please proceed with your question

Speaker 14: Good morning. My question is about dispositions. I find interesting that some of the assets that you have sold had low occupancy. Westchester Square, Springdale, and a few others sold earlier in the year, not too many but some, which would suggest that perhaps those assets had remaining upside. So my question is, did these centers have anything in common that made it more compelling to pursue a sale rather than driving additional occupancy internally, particularly given the good leasing momentum? Good morning. good morning My question is about dispositions. my question is about dispositions I find interesting that some of the assets that you have sold had low occupancy. i find interesting that some of the assets that you have sold had low occupancy Westchester Square, Springdale, and a few others sold earlier in the year, not too many but some, which would suggest that perhaps those assets had remaining upside. westchester square springdale and a few others sold earlier in the year not too many but some which would suggest that perhaps those assets had remaining upside So my question is, did these centers have anything in common that made it more compelling to pursue a sale rather than driving additional occupancy internally, particularly given the good leasing momentum? so my question is did these centers have anything in common that made it more compelling to pursue a sale rather than driving additional occupancy internally particularly given the good leasing momentum

Speaker 1: Yeah. It's a great question. And I think you've seen a mix there historically, Paulina, of several centers too that we had during the year that were close to 100% occupied. I think we are focused on ROI. And so yes, there was some vacancy. But we just answered a question about CapEx. Are we going to put those dollars to work accretively? And you've seen us do that across the portfolio. But in areas where we don't see the ability to do that accretively, we say to ourselves, "Hey, how does the hold decision compare to the sale decision? Are we better off recycling the capital somewhere else?" And as Mark spent some time going through, we're seeing some great bids for assets. Yeah. yeah It's a great question. it's a great question And I think you've seen a mix there historically, Paulina, of several centers too that we had during the year that were close to 100% occupied. and i think you've seen a mix there historically paulina of several centers too that we had during the year that were close to 100% occupied I think we are focused on ROI. i think we are focused on roi And so yes, there was some vacancy. and so yes there was some vacancy But we just answered a question about CapEx. but we just answered a question about capex Are we going to put those dollars to work accretively? are we going to put those dollars to work accretively And you've seen us do that across the portfolio. and you've seen us do that across the portfolio But in areas where we don't see the ability to do that accretively, we say to ourselves, "Hey, how does the hold decision compare to the sale decision? but in areas where we don't see the ability to do that accretively we say to ourselves "hey how does the hold decision compare to the sale decision Are we better off recycling the capital somewhere else?" And as Mark spent some time going through, we're seeing some great bids for assets. are we better off recycling the capital somewhere else?" and as mark spent some time going through we're seeing some great bids for assets So we can take that capital and deploy it elsewhere where we can get a more accretive return. So that's really it. I mean, if you look at it, occupancy impact from dispositions was a very, very small percentage during the year. That wasn't the motivating factor there. It was, A, they were in markets where we don't have a huge presence in those two assets in particular. But more importantly, we just didn't see the ROI and the investment that we would have to make to drive that occupancy forward at those centers. So we can take that capital and deploy it elsewhere where we can get a more accretive return. so we can take that capital and deploy it elsewhere where we can get a more accretive return So that's really it. so that's really it I mean, if you look at it, occupancy impact from dispositions was a very, very small percentage during the year. i mean if you look at it occupancy impact from dispositions was a very very small percentage during the year That wasn't the motivating factor there. that wasn't the motivating factor there it It was, A, they were in markets where we don't have a huge presence in those two assets in particular. it was a they were in markets where we don't have a huge presence in those two assets in particular But more importantly, we just didn't see the ROI and the investment that we would have to make to drive that occupancy forward at those centers. but more importantly we just didn't see the roi and the investment that we would have to make to drive that occupancy forward at those centers

Speaker 13: Our next question comes from a line of Tayo Okusanya with Deutsche Bank. Please proceed with your question. Our next question comes from a line of Tayo Okusanya with Deutsche Bank. our next question comes from a line of tayo okusanya with deutsche bank Please proceed with your question. please proceed with your question

Speaker 18: Yes. Good morning, everyone. Again, congrats, Brian and Stacy. No one is more deserving. Congrats to you as well. Just a question around, again, fundamentals in the strip side just kind of seem very strong across the board. And I'm just curious, as you kind of think about the industry as a whole and yourself and all your peers, I mean, are we setting up for a year where it's kind of rising tides lifts all boats? Or fundamentally, do you think we're still going to see differences across all the key platforms? And in this kind of environment, what really are the key things in your mind that would lead to greater success versus another operator in this space? Yes. yes Good morning, everyone. good morning everyone Again, congrats, Brian and Stacy. again congrats brian and stacy No one is more deserving. no one is more deserving Congrats to you as well. congrats to you as well Just a question around, again, fundamentals in the strip side just kind of seem very strong across the board. just a question around again fundamentals in the strip side just kind of seem very strong across the board And I'm just curious, as you kind of think about the industry as a whole and yourself and all your peers, I mean, are we setting up for a year where it's kind of rising tides lifts all boats? and i'm just curious as you kind of think about the industry as a whole and yourself and all your peers i mean are we setting up for a year where it's kind of rising tides lifts all boats Or fundamentally, do you think we're still going to see differences across all the key platforms? or fundamentally do you think we're still going to see differences across all the key platforms And in this kind of environment, what really are the key things in your mind that would lead to greater success versus another operator in this space? and in this kind of environment what really are the key things in your mind that would lead to greater success versus another operator in this space

Speaker 1: Yeah. It's a great question. There's no doubt the environment is strong. I think we're as well positioned as anybody in terms of all the things that we've been talking about on this call relative to the low-rent basis, the occupancy upside, the visibility on the strength of the redevelopment pipeline. We haven't spent a ton of time on this today. In what we already own and control, you think about the projects that we've got with Publix, the one that we just launched this quarter in Metro New York, the one that Mark bought last year in South Tampa, Plano, Texas. We're going to be opening up our first large-format Target in Dallas in a couple of weeks. We're very excited about the nature of that pipeline going forward. Yeah. yeah It's a great question. it's a great question There's no doubt the environment is strong. there's no doubt the environment is strong I think we're as well positioned as anybody in terms of all the things that we've been talking about on this call relative to the low-rent basis, the occupancy upside, the visibility on the strength of the redevelopment pipeline. i think we're as well positioned as anybody in terms of all the things that we've been talking about on this call relative to the low-rent basis the occupancy upside the visibility on the strength of the redevelopment pipeline We haven't spent a ton of time on this today. we haven't spent a ton of time on this today In what we already own and control, you think about the projects that we've got with Publix, the one that we just launched this quarter in Metro New York, the one that Mark bought last year in South Tampa, Plano, Texas. in what we already own and control you think about the projects that we've got with publix the one that we just launched this quarter in metro new york the one that mark bought last year in south tampa plano texas We're going to be opening up our first large-format Target in Dallas in a couple of weeks. we're going to be opening up our first large-format target in dallas in a couple of weeks We're very excited about the nature of that pipeline going forward. we're very excited about the nature of that pipeline going forward I think if you look at the ability to grow and the ability to do that incrementally and accretively, I think we stand apart. Yes, the environment's strong. Our retailers are performing. I think the position that we've put the portfolio in really allows us to capitalize on that going forward. I think if you look at the ability to grow and the ability to do that incrementally and accretively, I think we stand apart. i think if you look at the ability to grow and the ability to do that incrementally and accretively i think we stand apart Yes, the environment's strong. yes the environment's strong Our retailers are performing. our retailers are performing I think the position that we've put the portfolio in really allows us to capitalize on that going forward. i think the position that we've put the portfolio in really allows us to capitalize on that going forward

Speaker 13: Our next question is a follow-up from Caitlin Burrows with Goldman Sachs. Please proceed with your question. Our next question is a follow-up from Caitlin Burrows with Goldman Sachs. our next question is a follow-up from caitlin burrows with goldman sachs Please proceed with your question. please proceed with your question

Speaker 2: Hi again. You guys mentioned earlier how the balance sheet set net debt to EBITDA of 5.4x. I guess how are you thinking of that and where you want to be? Is lower better? Or are you in the right range? Or would you be okay going higher? Hi again. hi again You guys mentioned earlier how the balance sheet set net debt to EBITDA of 5.4x. you guys mentioned earlier how the balance sheet set net debt to ebitda of 5.4x I guess how are you thinking of that and where you want to be? i guess how are you thinking of that and where you want to be Is lower better? is lower better Or are you in the right range? or are you in the right range Or would you be okay going higher? or would you be okay going higher

Speaker 17: Yeah. I think Brian mentioned it in his remarks. I mean, we continue to be very disciplined with the balance sheet. I think where we are in the mid-fives, based on the amount of growth that we see coming, we feel very well positioned here. But obviously, we'll keep an eye on it as we move through the year. But I think we're pretty comfortable here in the mid-fives. Yeah. yeah I think Brian mentioned it in his remarks. i think brian mentioned it in his remarks I mean, we continue to be very disciplined with the balance sheet. i mean we continue to be very disciplined with the balance sheet I think where we are in the mid-fives, based on the amount of growth that we see coming, we feel very well positioned here. i think where we are in the mid-fives based on the amount of growth that we see coming we feel very well positioned here But obviously, we'll keep an eye on it as we move through the year. but obviously we'll keep an eye on it as we move through the year But I think we're pretty comfortable here in the mid-fives. but i think we're pretty comfortable here in the mid-fives

Speaker 13: Our next question is a follow-up from Paulina Rojas with Green Street. Please proceed with your question. Our next question is a follow-up from Paulina Rojas with Green Street. our next question is a follow-up from paulina rojas with green street Please proceed with your question. please proceed with your question

Speaker 14: Thank you. I wanted to follow up on your comments about the improved tenant quality. I think you mentioned that roughly 75, I think you said, of the small shop tenants are multi-unit operators. Can you put some historical context on that metric so we can better compare and contrast the improvement over time? Thank you. thank you I wanted to follow up on your comments about the improved tenant quality. i wanted to follow up on your comments about the improved tenant quality I think you mentioned that roughly 75, I think you said, of the small shop tenants are multi-unit operators. i think you mentioned that roughly 75 i think you said of the small shop tenants are multi-unit operators Can you put some historical context on that metric so we can better compare and contrast the improvement over time? can you put some historical context on that metric so we can better compare and contrast the improvement over time

Speaker 1: Yeah. I think it's certainly up from where it was. We can get to the exact number. I think one of the things that we've seen there, Paulina, because we've seen a reduction just in kind of that true one-off local tenancy. It's down to 17% of our ABR. One of the reasons that we wanted to highlight it is because as we were digging through and this came up as, again, part of some of the data work that we've been doing across the portfolio was we were really not surprised by it because we're seeing it come through in our leasing committee. But it really kind of reassured the thoughts that we had about the trajectory of the portfolio and the fact that we did have more established small shop tenants in particular that were successful, right? Yeah. yeah I think it's certainly up from where it was. i think it's certainly up from where it was We can get to the exact number. we can get to the exact number I think one of the things that we've seen there, Paulina, because we've seen a reduction just in kind of that true one-off local tenancy. i think one of the things that we've seen there paulina because we've seen a reduction just in kind of that true one-off local tenancy It's down to 17% of our ABR. it's down to 17% of our abr One of the reasons that we wanted to highlight it is because as we were digging through and this came up as, again, part of some of the data work that we've been doing across the portfolio was we were really not surprised by it because we're seeing it come through in our leasing committee. one of the reasons that we wanted to highlight it is because as we were digging through and this came up as again part of some of the data work that we've been doing across the portfolio was we were really not surprised by it because we're seeing it come through in our leasing committee But it really kind of reassured the thoughts that we had about the trajectory of the portfolio and the fact that we did have more established small shop tenants in particular that were successful, right? but it really kind of reassured the thoughts that we had about the trajectory of the portfolio and the fact that we did have more established small shop tenants in particular that were successful right And it tied to everything else we've been talking about relative to the strong payment trends, relative to the record small shop rents that we've been able to achieve. And then if you just think of the overall quality of tenants that we're adding to the portfolio, you look at those higher-quality QSRs, right? There is a focus on health and wellness. And whether it's the strong regional operators like NAYA and honeygrow or the CAVAs or the Tatte Bakeries that we're attracting to the portfolio, then you look at some higher-end tenants like Sephora, Warby Parker that we just added our first locations to. We opened a Capital Grille last year in a grocery-anchored shopping center in suburban Philadelphia. So these are names that maybe seven, eight years ago, we would not have been attracting to the portfolio. And it tied to everything else we've been talking about relative to the strong payment trends, relative to the record small shop rents that we've been able to achieve. and it tied to everything else we've been talking about relative to the strong payment trends relative to the record small shop rents that we've been able to achieve And then if you just think of the overall quality of tenants that we're adding to the portfolio, you look at those higher-quality QSRs, right? and then if you just think of the overall quality of tenants that we're adding to the portfolio you look at those higher-quality qsrs right There is a focus on health and wellness. there is a focus on health and wellness And whether it's the strong regional operators like NAYA and honeygrow or the CAVAs or the Tatte Bakeries that we're attracting to the portfolio, then you look at some higher-end tenants like Sephora, Warby Parker that we just added our first locations to. and whether it's the strong regional operators like naya and honeygrow or the cavas or the tatte bakeries that we're attracting to the portfolio then you look at some higher-end tenants like sephora warby parker that we just added our first locations to We opened a Capital Grille last year in a grocery-anchored shopping center in suburban Philadelphia. we opened a capital grille last year in a grocery-anchored shopping center in suburban philadelphia So these are names that maybe seven, eight years ago, we would not have been attracting to the portfolio. so these are names that maybe seven eight years ago we would not have been attracting to the portfolio I think it speaks to all the work that the team has done on the reinvestment front, the fact that consumers in the markets in which we own shopping centers are just demanding more from those markets in terms of the quality of restaurants and the quality of services. So it gives us the opportunity to provide that. Overall, I think you can see it come through in the types of tenants, the names of the tenants who we're signing, and then just the strength of that tenancy coming through in the rest of the operating metrics. I think it speaks to all the work that the team has done on the reinvestment front, the fact that consumers in the markets in which we own shopping centers are just demanding more from those markets in terms of the quality of restaurants and the quality of services. i think it speaks to all the work that the team has done on the reinvestment front the fact that consumers in the markets in which we own shopping centers are just demanding more from those markets in terms of the quality of restaurants and the quality of services So it gives us the opportunity to provide that. so it gives us the opportunity to provide that Overall, I think you can see it come through in the types of tenants, the names of the tenants who we're signing, and then just the strength of that tenancy coming through in the rest of the operating metrics. overall i think you can see it come through in the types of tenants the names of the tenants who we're signing and then just the strength of that tenancy coming through in the rest of the operating metrics

Speaker 14: Thank you. Thank you. thank you

Speaker 1: Thanks, Paulina. Thanks, Paulina. thanks paulina

Speaker 13: We have no further questions at this time. Ms. Slater, I'd like to turn the call back over to you for closing comments. We have no further questions at this time. we have no further questions at this time Ms. Slater, I'd like to turn the call back over to you for closing comments. ms slater i'd like to turn the call back over to you for closing comments

Speaker 16: Great. Thank you all for joining us today. We look forward to seeing many of you over the next few weeks. Great. great Thank you all for joining us today. thank you all for joining us today We look forward to seeing many of you over the next few weeks. we look forward to seeing many of you over the next few weeks

Speaker 13: Ladies and gentlemen, this does conclude today's teleconference. You may disconnect your lines at this time. Thank you for your participation, and have a wonderful day. Ladies and gentlemen, this does conclude today's teleconference. ladies and gentlemen this does conclude today's teleconference You may disconnect your lines at this time. you may disconnect your lines at this time Thank you for your participation, and have a wonderful day. thank you for your participation and have a wonderful day